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Saturday, February 4, 2017 Jumada I 7, 1438 AH NONFARM PAYROLLS UP : Page 12 US job growth GULF TIMES accelerates in January, BUSINESS but wages lag A M Best affirms Oil rises as US imposes QIIC rating with ‘stable’ outlook

By Santhosh V Perumal agency said while the com- Business Reporter pany benefits from moderate new sanctions on Iran underwriting leverage, capital requirements are largely Reuters A M Best, an international insur- driven by asset risk relating to New York/London ance rating agency, has aff irmed the company’s concentrated Qatar Islamic Insurance Com- portfolio, which is weighted pany’s financial strength rating towards domestic equities and il prices jumped yesterday after at ‘B++ (Good)’ and long-term real estate assets. the United States imposed sanc- issuer credit rating at “bbb+” The policyholders’ fund is Otions on some Iranian individuals with “stable” outlook. “suff iciently” capitalised on a and entities, days after the White House The ratings reflect the insurer’s standalone basis, supported by put Tehran “on notice” over a ballistic track record of excellent operat- QR110mn of retained surplus as missile test. ing performance, adequate com- on September 30, 2016. Front month US West Texas Intermedi- bined risk-adjusted capitalisation QIIC has a track record of strong ate crude futures climbed 24¢ to $53.78, (considering both shareholders’ operating and technical profit- after closing 34¢ down on Thursday, as of and policyholders’ funds), and ability, highlighted by a five-year 12:22pm ET (1722 GMT). The contract is niche business profile as a suc- average combined ratio of 80%. up nearly 1% on the week. cessful takaful provider in the During the first nine months of Brent crude futures were up 30¢ at Qatar insurance market. 2016, the company generated a $56.86 a barrel; it was on track for a more However, off setting rating fac- net profit of QR50mn. than 2% gain since Monday, its fi rst sig- tors include limited enterprise “There has generally been a nifi cant weekly rise this year. risk management and a high good balance of earnings be- Volume in US crude futures was rela- concentration of illiquid assets tween technical and investment tively low yesterday, with about 335,000 within its investment portfolio, income. Although the company contracts changing hands by 12:15pm, on it said. has sustained unrealised losses track to fall short of the 200-day moving This year, QIIC-led six-member on its equity portfolio over the average for 528,000 contracts. natural insurance consor- past five years, its five-year Analysts said the market is torn be- tium was handed down a big (2011-2015) average investment tween promised cuts from the Organisa- deal by Supreme Council for return (including gains and tion of the Petroleum Exporting Coun- Delivery and Legacy for capital losses) has been reasonable at tries (Opec) and fears over rising US shale expenditure works related to 5.5%,” A M Best said. oil production. the construction of tournament QIIC has a niche position in its “While the market is taking these ac- stadiums. Qatar Rail had in domestic insurance market as tions in stride so far as unlikely to result 2014 awarded a similar deal to a provider of Shariah-compliant in a larger military confl ict that would put another consortium in which products, and a strong reputa- Gulf crude oil supplies at risk, the odds of QIIC was also a member. tion that is somewhat attribut- that scenario are certainly higher than a QIIC adopts a combined takaful able to the company’s track week ago,” wrote Timothy Evans, energy model, whereby the sharehold- record of distributing surpluses analyst at Citi Futures in New York. ers’ fund charges the policy- back to policyholders. Trump had warned on Twitter that holders’ fund a ‘Wakala’ fee on QIIC’s gross written premium “Iran is playing with fi re” after its missile gross written premiums and a grew 2.5% to QR225mn during test. ‘Muderaba’ fee on investment the first three quarters of 2016, “The ‘trumperament’ of the new US income. in comparison to the same president is being tested by Iran and soon The insurance company’s ability period in 2015. maybe also by Russia and China,” said Emissions rise from the Monroe Energy Trainer Refinery in Marcus Hook, Pennsylvania. Front month US West Texas Intermediate to accumulate surpluses within Its enterprise risk manage- Olivier Jakob, managing director of con- crude futures climbed 24¢ to $53.78 as of 12:22pm ET (1722 GMT). The contract is up nearly 1% on the week. Brent crude futures were the policyholders’ fund whilst ment is developing, and whilst sultancy PetroMatrix.” And that is adding up 30¢ at $56.86 a barrel; it was on track for a more than 2% gain since Monday, its first significant weekly rise this year. regularly distributing surplus the company’s track record of some geopolitical support to crude oil.” back to policyholders “supports technical profitability illustrates Meanwhile, oil majors and trading The widening diff erential for Middle in December, its second increase in a row, lacklustre demand for the fuel. Crude the sustainability” of the takaful good underwriting controls, in- houses are set to ship an unprecedented East benchmark Dubai over US crude also according to US Bureau of Labor Statistics prices have since more than doubled from model, it said. vestment decisions are made at volume of US crude oil to Asia in com- opened the arbitrage to the Far East. (BLS) data. their February low to around $54 a bar- Although QIIC’s combined the board level, which has led to ing weeks, boosting already high fl ows to The US crude cargoes, which will in- The energy data was contained in a La- rel as the Opec and non-Opec producers risk-adjusted capitalisation volatility in investment results, the region due to higher prices from Opec clude both light and heavy grades, will bour Department report that also said US agreed to reduce output during the fi rst remains “adequate”, the rating according to the rating agency. production cuts. reach China, Japan and Singapore, ac- nonfarm payrolls increased by 227,000 half of 2017 in an eff ort to stem the over- Traders have estimated that some cording to four trading sources and Reu- jobs last month, the largest gain in four supply. 700,000 to 900,000 barrels per day is set ters shipping data. months, while the unemployment rate rose Analysts said US exploration and pro- to leave the United States in February, with Some exports are also headed to Europe one-tenth of a percentage point to 4.8%. duction (E&P) companies responded to the majority of the cargoes headed to Asia. and Latin America. The BLS only has support services jobs those higher prices by adding around 250 That volume would be the highest “It’s a good time to buy US crude be- data through December, while oil and gas oil rigs over the past eight months, with monthly level on record, according to the cause of the Opec cut, but our spot room extraction data is available through January. even more spending expected on drilling US Energy Information Administration, has limitations so we have to compare Energy fi rms cut more than 165,000 over the next year or two. helping reduce an US inventory glut that every cargo,” said an offi cial with a Japa- jobs over the past two years as they Analysts at US fi nancial services fi rm has pressured prices for two years. nese refi ner, who declined to be named slashed the number of rigs drilling for oil Cowen & Co said this week in a note that The fl ood could create a supply surplus due to company policy. from a peak of 1,609 in October 2014 to a capital expenditure tracking showed 31 in Asia, possibly pushing prices for re- US oil and natural gas producers added six-year low of 316 in May, according to exploration and production (E&P) com- gional grades lower, traders said, as local jobs in December and January as drillers statistics from Labor and energy logistics panies planned to increase spending by an refi ners are ill-equipped to process that continued to return to the well pad with fi rm Baker Hughes. average of 36% in 2017 over 2016. fl ow. crude prices holding near 18 month highs, Those cuts came during the biggest That expected spending increase in The ratings reflect the insurer’s track record of excellent The economics recently became fa- according to US jobs data yesterday. price rout in a generation, in which US 2017 follows an estimated 45% decline operating performance, adequate combined risk-adjusted vourable after Brent’s premium over US Oil and gas extraction jobs increased by crude futures collapsed from over $107 a in 2016 and a 37% decline in 2015, Cowen capitalisation and niche business profile as a successful takaful crude widened to the most in nearly a 100 to 177,400 in January, while support barrel in June 2014 to around $26 in Feb- said according to the 65 E&P companies it provider in the Qatar insurance market. year. services jobs increased by 600 to 195,200 ruary 2016 due to a global oil glut and tracks. World business grows as it faces upcoming risks

Global business activity started Asia to Europe to the United States in- from a government crackdown on cur- land sharply revised up its growth the eurozone, seen as a good guide to strong housing market and higher gov- 2017 on solid ground; political risks creasing or at least largely maintaining rency in circulation, the pace slowed. forecast for 2017 to 2.0%, a view held growth, held at 54.4. ernment spending on infrastructure could curtail growth this year activity. “The outlook for this year is reason- by only the most optimistic forecaster It has not been higher since May 2011 projects. Eurozone businesses started 2017 by ably bright despite all the risks. The in a Reuters poll of 50 economists tak- and has remained above the 50 mark A recovery in the country’s “smoke- Reuters increasing activity at the same multi- numbers for January have generally en last month. dividing growth from contraction since stack” industries has also been sup- London year record pace they set in December been quite positive,” said Andrew Ken- Britain’s economy unexpectedly mid-2013. ported by government mandates to while the US non-farm payroll report ningham, chief global economist at outpaced all its major peers last year, That points to fi rst quarter expansion close down outdated production ca- showed job growth surging more than Capital Economics. wrong-footing those who expected an of 0.4%, Markit said, matching the me- pacity in the coal and steel sectors, lobal businesses started 2017 on expected in January as construction immediate hit from June’s Brexit vote. dian prediction in a Reuters poll. as well as a rebound in investment in a solid footing, surveys showed fi rms and retailers ramped up hiring. So far those risks seem to have The Markit/CIPS British services A similar survey from the US showed the property sector that came amid a Gyesterday, thriving ahead of a “Overall while this report is further been mostly ignored with fi rms Purchasing Managers’ Index dropped non-manufacturing growth dipped record fl ood of credit. myriad of political risks in the coming evidence that the (US) labour market from Asia to Europe to the United to a three-month low of 54.5 last month marginally last month. India’s Nikkei/IHS Markit Services year. is buoyant the continued slow pace of States increasing or at least from December’s 15-month high, at the China’s factory activity expanded PMI remained below 50 registering Fears of a growing protectionist wage growth means that the (Federal largely maintaining activity bottom end of a range of forecasts in a for the seventh straight month in Janu- 48.7 in January as fi rms still reel from agenda in the United States, whether Reserve) will feel under no great pres- Reuters poll of economists, but Markit ary, giving Beijing more room to tackle Prime Minister Narendra Modi’s deci- national elections across Europe upset sure to step up the pace of monetary Growth in Britain’s services sector said the PMIs still point to fi rst quarter chronic imbalances in the economy. sion in November to abolish high-value the status quo and just how fractious tightening,” economists at Lloyds Bank slowed for the fi rst time in four months growth of 0.5%. The Caixin/Markit Manufacturing bank notes. Britain’s divorce proceedings from the told clients in a note. in January, dipping just below its long- “Despite the slightly disappoint- PMI fell to 51.0. Modi’s policy removed 86% of the European Union become, are all ex- China’s factory activity grew for a run average, as businesses battled the ing outcome this remains a very strong The world’s second largest economy currency in circulation, hitting con- pected to weigh in the months ahead. seventh month and while India’s serv- sharpest rise in costs in more than fi ve report,” said James Knightley, senior has seen a broad-based pickup in re- sumption and capital investments, and Yet so far those risks seem to have ices business contracted for a third years. economist at ING. cent months, with fourth-quarter GDP shattered traditional cash-reliant sup- been mostly ignored with fi rms from month as fi rms struggled to recover But on Thursday the Bank of Eng- IHS Markit’s fi nal composite PMI for beating expectations due largely to a ply chains. Gulf Times 2 Saturday, February 4, 2017 BUSINESS

Commerzbank, BNP give jittery millionaires in Asia cash alternative China raises short-term Bloomberg Hong Kong

Wealthy Asian investors who are nervous about the market’s outlook after President Donald rates in tightening sign Trump’s election are moving into products that are almost as safe as cash and off er the possibility Reuters of extra returns. Shanghai BNP Paribas SA has sold more than $150mn of its ‘Helium’ structured notes since October hina’s central bank surprised that promise investors a higher- fi nancial markets yesterday yielding alternative to holding Cby raising short-term inter- cash, according to Prashant est rates on the fi rst day back from a Bhayani, the chief investment long holiday, in a further sign of policy off icer for Asia at BNP Paribas tightening as the economy shows signs Wealth Management. Commerz- of steadying. bank AG and Citigroup Inc are While the rate increases were mod- off ering similar products. “Going est, they reinforced views that Chinese into 2017, despite our best authorities are intent on both contain- eff orts lots of clients are sitting ing capital outfl ows and reining in risks on cash,” said Singapore-based to the fi nancial system created by years Bhayani. “They are looking for of debt-fuelled stimulus. what’s low risk in terms of volatil- Higher interest rates could prod ity and can generate higher debt-laden fi rms into deleveraging, returns.” though at the risk of stunting growth. Defying investor expectations “It appears to be an intent to control that Trump’s victory would hurt a real estate bubble. It could also be shares, the Dow Jones Industrial aimed at arresting the yuan’s deprecia- reached a record high in Janu- tion, although it is on the reverse repo ary, while bond yields jumped they touched upon and the impact re- on speculation his promised tax mains to be seen,” said Naoto Saito, cuts and infrastructure spending chief economic researcher at the Daiwa would fuel inflation. Tumbles in Institute of Research In Tokyo. US shares this week on Trump’s “All in all, it comes across as a move immigration order highlighted to tweak interest rate levels to accom- the risk that his policy decisions pany a broader monetary policy shift.” could weigh on equity markets The People’s Bank of China (PBoC) as well. BNP Paribas’ dollar- raised the interest rate on open market denominated 3.5-year product operation reverse repurchase agree- guarantees investors’ capital, ments (repos) by 10 basis points, eff ec- is tied to the performance of tive yesterday. four funds across asset classes It also raised the lending rates on its and allows investors to exit at standing lending facility (SLF) short- any time for a fee. It also has a term loans. cap to guard against volatility PBoC assistant governor Zhang Xi- if markets drop too sharply and aohui said later yesterday that mon- a hedge against rising interest etary policy will be kept generally pru- rates eroding the value of the dent and stable, while also avoiding embedded bonds. The minimum either a rapid slowdown in economic investment is $100,000, making growth or excessive liquidity injections. high net worth individuals its Zhang also said China will keep the A staff member walks in front of the headquarters of the People’s Bank of China in Beijing. The central bank raised the interest rate on open market operation reverse target buyers. yuan basically stable and will avoid repurchase agreements (repos) by 10 basis points, eff ective yesterday. “Investors are concerned by large volatility in interest rates and for- the risk of rising rates. This is eign exchange rates. raise the policy lending rate for now. addressed. China’s debt to GDP ratio “It’s not a good kick off of the Lu- months aimed at making it more diffi - not a guaranteed return, getting The comments were made in an essay The one-year policy lending rate was rose to 277% at the end of 2016 from nar New Year. It is a clear sign that the cult for Chinese individuals and com- just your capital back is the published by China Finance, a PBoC- last cut in October 2015 to 4.35%. 254% the previous year, with an in- central bank has switched to tighten its panies to send money abroad. downside and historically we affi liated magazine, through the mes- “China’s economic recovery is still creasing share of new credit being used monetary policy,” said a trader at a Chi- China’s currency reserves fell by have been targeting a 4% annual saging service WeChat. shaky, while the global economic situ- to pay debt servicing costs, UBS ana- nese bank in Shanghai. a tenth last year and, at $3.011tn, are return,” according to Bhayani, Analysts said the tightening of pri- ation is unstable, so raising open mar- lysts said in a note. China’s economy has seen a broad- close to falling below psychologically who said that the current per- marily money market rates suggested ket rates is more appropriate than rais- Asian stock markets extended mod- based pickup in recent months, due signifi cant levels. formance is flat. the PBoC wanted to retain policy fl ex- ing benchmark rates,” said Li Huiyong, est early losses after the rate rise, while largely to a strong housing market and “The signal is very clear,” said Zhou Commerzbank has sold simi- ibility as it balances the need to keep the chief economist at Shenwan Hongyuan China bond futures fell as much as 1.5% higher government spending on infra- Hao, senior Asian emerging market lar notes tied to mutual funds in economy from slowing again. Securities. at one point. structure projects. economist at Commerzbank in Singa- Europe to clients dealing with Other moves in recent months had “It’s a fl exible tool, which can be eas- Most Chinese and global metal prices At the same time, however, capi- pore, referring to the latest rate move. negative rates and are develop- signalled that Beijing was eyeing a grad- ily reversed if China’s economy shows also fell on fears that higher rates will tal flight from the tightly managed Hao said this time the tightening was ing a product for Asian clients ual shift from its loose policy stance. signs weakness again.” sap demand. economy has been strong, fuelled by more targeted compared with China’s who are holding too much cash, In late January, the PBoC raised rates The world’s second-largest econ- The PBoC raised the seven-day open expectations that the yuan currency previous tightening cycle that ended in according to Franck Fayard, on its medium-term loan facility (MLF) omy grew 6.7% last year – roughly in market operations rate – its unoffi cial will depreciate further after sliding to 2013. Hong Kong-based head of prod- for the fi rst time since it debuted the li- the middle of the government’s target policy rate – to 2.35% from 2.25%, while more than eight-year lows against the “Infl ation at that time was rising very uct engineering for equity and quidity tool in 2014. range. also lifting rates for SLF loans. dollar. rapidly and at this time infl ation is not funds at the bank. It was the fi rst time it has raised one But heavy policy stimulus – evident The SLF rate acts as a de facto ceiling The yuan fell nearly 7% last year, really an issue. Secondly, the yuan was “Some clients are interested of its policy interest rates since July in record lending from mostly state- for interbank lending, analysts said. its biggest loss against the dollar since under pressure to appreciate at that in deposit alternatives that can 2011. owned banks and increased govern- China’s central bank also injected 1994, on worries about shaky growth time.” be redeemed at any time,” he Analysts expect any further steps ment spending – has fuelled worries funds through 7-day, 14-day and 28- early in the year and amid a surge in the “Right now it’s totally diff erent. If said. “They are becoming more to be gradual as policymakers weigh about the risks of high debt levels and day repos yesterday, although there was dollar. you have capital outfl ows, that’s already cautious and want products with their impact on economic growth, and an overheating housing market that a net drain of funds for the day owing to Bearish yuan views have persist- tightening. And then you tighten fur- protection as they may have lost believe the PBoC will be in no hurry to could threaten fi nancial stability if not maturing open market operations. ed despite a slew of moves in recent ther, which is a double-whammy.” money or received no coupons last year.” Citigroup’s off ering in this area includes a fund-based product with a minimum three-month holding period paying the Lon- Japan economy seen expanding for 4th straight quarter don interbank off ered rate plus 30 basis points that has attracted more than $1bn since launching Reuters of 20 analysts, after posting growth of in Europe.” The poll found net exports were seen rising 3.1% in December policy,” said Takumi Tsunoda, senior last January, according to Cyrille Tokyo 1.3% in the third quarter. added 0.3 percentage point to growth from the previous month, up for the economist at Shinkin Central Bank. Troublaiewitch, the head of the Under those circumstances quarter- in October-December, the same as it fi rst time in two months. The Cabinet Offi ce will publish the multi-asset group for Asia Pa- on-quarter growth would a 0.3% gain, contributed in the third quarter. The highly volatile data series, re- machinery orders data on February 9. cific at the US bank. The product apan’s economy was seen growing unchanged from July-September. Capital spending was seen growing garded as an indicator of capital spend- The poll found Japan was likely doesn’t off er capital protection. for a fourth straight quarter in Oc- “Data will likely confi rm the econ- 0.9% in the last quarter, the poll found, ing in the next six to nine months, fell to post a current account surplus of “Last year many investors Jtober-December thanks to stronger omy is on a moderate recovery led by rising for the fi rst time in two quarters. 5.1% in November. ¥1.29tn ($11.42bn) in December, which were sitting on the sidelines,” he exports and a pickup in capital spend- a pickup in overseas economies,” said Private consumption, which ac- From a year ago, core orders, which would be 30 straight surplus month. said. “There was an unexpected ing, a Reuters poll found yesterday. Hidenobu Tokuda, senior economist at counts for roughly 60% of gross do- exclude orders for ships and electrical The corporate goods price index rally after Brexit and Trump that Poll respondents saw the economy Mizuho Research Institute. mestic product, was seen fl at in the last equipment, were expected to rise 4.6% (CGPI), which measures the price investors didn’t benefit from so as likely continuing to recover even “Japan’s economic recovery is ex- quarter, after posting modest gains in in December after a 10.4% gain in No- companies charge each other for goods now they are looking for cash though uncertainty over the policies of pected to continue, helped by global the previous three quarters. vember. and services likely stopped falling in alternatives. They don’t want US President Donald Trump remains economic growth and yen weakness. The Cabinet Offi ce will announce “Corporate investment sentiment December helped by price gains in risky products as the Trump rally deep. The economy was expected to But downside risks are also high be- the GDP data on February 13. is picking up as a brighter mood is oil- and coal-related products after 21 may flatten out this year.” expand at an annualised rate of 1.1% in cause of uncertainty over protection- Japan’s core machinery orders, a spreading in the global economy – al- straight months of posting year-on- the fourth quarter, according to the poll ism in the US and the political situation leading indicator of capital spending, though we cannot dispel risks from US year declines. Tata Motors to launch TAMO brand

Reuters Motor show in March, the company said in was restructuring its passenger vehicles Mumbai a statement, without giving further details. business in India, which includes reducing Trade magazine Autocar has said that the the number of car platforms from six to two first TAMO car will be a two-seater, mid- to improve production efficiencies. The ndian carmaker Tata Motors said on engined sportscar, internally called the Fu- two modular platforms, to be introduced Thursday it was set to launch the first turo. in 2018, will carry different powertrains Icar under its new TAMO brand next Tata Motors, which owns the British lux- including hybrid and electric, and a wide month, with the brand aimed at testing ury carmaker Jaguar Land Rover, has previ- range of different body designs including new technologies and enabling the compa- ously faced criticism for being slow to re- hatchbacks, crossovers and sport-utility ny to become more responsive to changing act to changing trends and has lost market vehicles (SUVs). market trends. share as a result. The company now expects The platforms will enable Tata Motors “This is about proof of concept... about TAMO to help it meet its target of becom- to widen its product range, taking it into bringing new technologies and ideas fast ing one of India’s three biggest carmakers market segments where it has previously to the market,” managing director Guent- by the end of March 2019 as it helps reposi- not been, the company said, adding that er Butschek told reporters at an event in tion the brand image. it has seen a shift in demand towards pre- Mumbai. Organised like a start-up, TAMO could mium hatchbacks and SUVs and away from “Eventually we will decide to take some employ people from outside the industry saloon cars. of these concepts into the mainstream,” he who will focus on sourcing new technolo- While some of Tata Motors’ existing and Guenter Butschek, Tata Motors’ CEO and managing director, poses with a Hexa car during its launch in said. gies and forming partnerships to develop recently-launched cars will be built on the Mumbai. The Indian carmaker is set to launch the first car under its new TAMO brand next month, with Butschek did not disclose how much has new transport concepts, the company said. new platform, the shift will naturally allow the brand aimed at testing new technologies and enabling the company to become more responsive to been invested so far but the first car under Tata Motors, maker of the loss-making it to phase out older models that it does not changing market trends, Butschek said yesterday. the brand will be launched at the Geneva Nano small car, also said on Thursday it see potential for, Butschek said. Gulf Times Saturday, February 4, 2017 3 BUSINESS

US tariff s on Mexican imports will ‘Japan to push back if Trump prompt operational meddles with BoJ freedom’ rethink, Reuters says Honda Tokyo apan will push back fi rmly on any attempts by US President Donald Reuters JTrump’s administration to med- Tokyo dle with its independence on setting currency and monetary policies, say sources familiar with the deliberations apan’s Honda Motor Co yester- in Tokyo. day said it would need to rethink It was the fi rst clear sign from Japan Jits operations in Mexico if the that Tokyo won’t allow Trump to dic- United States, its biggest market, tate domestic economic policy, leaving raised tariff s on imports from the room for potential tensions between the country as proposed by US staunch allies as Trump’s fi rst term gets President Donald Trump. underway. Honda is among global automak- Policymakers were shocked by an ers under pressure from Trump to accusation from Trump this week that ensure more cars sold in the United Tokyo is using “money supply” for cur- States are made locally, to increase rency devaluation, a sign his criticism jobs and shrink that country’s global could distract the BoJ from its years- trade defi cit. long eff orts to revitalise the economy. Japan’s third-biggest automaker Any explicit pressure from Trump said Trump’s proposed 20% tariff on that binds Japan’s hands on monetary imports from Mexico could prompt a policy would challenge existing inter- rethink of its presence there, where national protocols like a Group of 20 it operates two vehicle assembly agreement, which broadly recognises plants. that domestic polices are a matter for Last year, Honda made around individual members. 250,000 vehicles in Mexico, more Ahead of Prime Minister Shinzo than half of which were exported to Abe’s meeting with Trump next week, the United States. Japanese policymakers are preparing to “When it comes to Mexico, if argue that their ultra-loose monetary there were a big jump in tariff s on US policy is intended solely to beat defl a- imports, we would have to respond tion and was not currency manipula- in some way,” executive vice presi- tion, the sources said on condition of dent Seiji Kuraishi told reporters at anonymity. an earnings briefi ng. And if persuasion alone does not Trump has criticised automakers work, they will seek to coordinate with including Ford Motor Co, General Japan’s G7 and G20 counterparts for Motors Co and Toyota Motor Corp support that they are abiding by a joint US President Donald Trump and Japanese Prime Minister Shinzo Abe are seen on a TV monitor showing the Japanese yen’s exchange rate against the US dollar at a for making cars sold in the United agreement to refrain from using mon- foreign exchange trading company in Tokyo. Japanese policymakers were shocked by an accusation from Trump this week that Tokyo is using ‘money supply’ for States outside the country. etary policy for currency devaluation, currency devaluation, a sign his criticism could distract the BoJ from its years-long eff orts to revitalise the economy. But Japanese makers have in- the sources said. creasingly localised production over “Japan and Europe will continue to ket speculation that the central bank driven by expectations of steady Fed resist anything that it sees as meddling (TPP) pact by pulling out from the deal, the past three decades, with Honda’s promote independence of monetary won’t be able to ease further because rate hikes. With Japan’s economy only in domestic policy. Trump’s US election to the dismay of Abe who touted it as U.S.-produced vehicles accounting policy,” said a government offi cial with of US pressure – and for such market just emerging from stagnation, poli- victory in November initially brought key to his growth strategy. for around one-quarter of its global knowledge of the matter, adding that views to spark a self-fulfi lling jump in cymakers are ready to defend the BoJ’s benefi ts to Japan as dollar gains fueled Abe told parliament on Thursday he output. US criticism “won’t tie our hands.” the yen. massive stimulus and its independence by hopes for his stimulus policies weak- had no intention of making deals with “We’ve been investing in the “There’s no reason for the United “Trump’s rhetoric is dangerous for to use tools to fend off adverse shocks ened the yen in a boon to its exports. Trump on currency policy, though some United States for 40 years to develop States to criticise our currency and Japan,” said a source familiar with Ja- to the economy such as an abrupt yen But his recent remarks turned him analysts say Trump’s unorthodox gov- and manufacture cars. We hope that monetary policies.” pan’s currency policy. spike, the sources say. into one of the biggest risks to Japan’s erning style may pressure Japan. Trump understands this,” Kuraishi The BoJ’s stimulus programme and “If monetary easing is automatically “Anything Trump says won’t be a economy, with the dollar hitting a two- “I can’t see how Japan can convince said. the weak yen it brought have been one defi ned as currency manipulation, what hindrance to monetary easing, if such month low of 112.08 yen this week. Trump that its monetary policy is not In 2016, Honda sold a record of the few successes of Abe’s “Abenom- can Japan do? If Trump doesn’t want a action is necessary to achieve 2% infl a- Already, Trump has ruffl ed “Abe- targetting currencies,” said Masafumi 1.64mn vehicles in the United States, ics” policies, a cocktail of monetary strong dollar, the Federal Reserve would tion,” one of the sources said on condi- nomics” with his demand for Japanese Yamamoto, chief forex strategist at Mi- roughly one-third of which were im- stimulus, fi scal expansion and structur- have to hold off on hiking interest rates. tion of anonymity. carmakers to create more US jobs, po- zuho Securities. ported from Canada, Mexico, Japan al reforms, which have yet to pull Japan It opens up a can of worms.” Japan is putting together a package tentially forcing them to hold off on do- “Monetary policy will come under and Britain. out of defl ation. BoJ offi cials say they see good reason for Abe to show Trump next week that it mestic wage hikes. US pressure, making it diffi cult for the Around 70% of its vehicles pro- For the BoJ, the worst-case scenario to push back, arguing that the yen’s re- says would help create US jobs, govern- He also hammered the fi nal nail in the BoJ to ease policy further to weaken the duced in the United States are sold is for Trump’s remarks to heighten mar- cent falls are part of a broader dollar rise ment sources say, but Tokyo would still coffi n on the Trans-Pacifi c Partnership yen.” there. Earlier yesterday, Honda raised its net profi t forecast for the year ending March for the second time, to ¥545bn ($4.82bn) – 58.2% Japan readies package for Trump to help create 700,000 US jobs over the year earlier. It also said it expects the local currency to average 107 yen to the Reuters when Prime Minister Shinzo Abe export “high-quality” infrastructure cooperation in global infrastructure financial institutions, as well as the US dollar, compared with an earlier Tokyo visits Trump on February 10 in technology. investment, joint development of Government Pension Investment projection of 103 yen. Washington, envisage investments Japan will invest ¥17tn ($150bn) in robots and artificial intelligence, and Fund, the Asahi and other newspapers Honda suff ered warranty- and in infrastructure projects such as public and private funds over 10 cooperation in cybersecurity and reported. quality-related costs in the last Japan is putting together a package it high-speed trains and cybersecurity, years, the sources said. space exploration, among others. However, GPIF president Norihiro business year due largely to massive says could generate 700,000 US jobs said the sources, who declined to be That would include helping The government may tap its foreign Takahashi said on Thursday there recalls of potentially faulty air bags and help create a $450bn market, identified as they were not authorised develop high-speed railways in the exchange reserves account to fund was no truth to reports that the from supplier Takata Corp. to present to US President Donald to speak to the media. northeastern United States, and the part of the package, the sources Fund would invest as a part of the But with those costs out of the Trump next week, government Investing in overseas infrastructure states of Texas and California, and said. government package, adding that the way this year, and with the yen sources familiar with the plans said. projects dovetails with a key plank renovating subway and train cars. It may also get funding from Fund made its investment decisions weakening since April, Honda ex- The five-part package, to be unveiled in Abe’s growth strategy, which is to The package also includes megabanks and government-affiliated to benefit policyholders. pects a boost in performance.

GIC chief sees ‘structural’ Modi’s math rests on rich asset-sale changes in tech, health Bloomberg ernment has budgeted for weak excise Mumbai collections. A projected 25% jump in Bloomberg by the wealth fund to expand into income taxes is premised on surging de- Singapore new areas. GIC last year hired a posits triggered by Modi’s cash ban last big-data expert and created the ndian Prime Minister Narendra Mo- year. Since there seem to be no alloca- Systematic Investment Group, di’s goal to shrink Asia’s widest budg- tions from the latest amnesty programme IC Pte’s newly appointed headed by former Goldman Sachs Iet defi cit to a decade-low rests on for tax evaders, it’s uncertain how much chief investment offi cer Group executive director Percy ambitious assumptions that will require revenue the government expects to earn GJeff rey Jaensubhakij said Wong, to consolidate its activities clinical execution, economists say. from it. the technology and health-care in quantitative investing. India’s government on Wednesday Expenditure targets are more uncertain industries may off er some of the The changes come as GIC has pledged to shrink the shortfall to 3.2% of than the revenue assumptions, according promising investment opportu- warned record-low interest rates gross domestic product in the year start- to India Ratings & Research Pvt, the local nities over the next decade, as and subdued global growth will ing April 1 from 3.5% the previous year. unit of Fitch Ratings. muted global growth weighs on weigh on investment returns in That’s wider than the 3% it previously Revenue expenditure – which includes returns from traditional assets. the coming decade. The fund in forecast and the second time Modi’s ad- salaries and subsidies – is budgeted to The industries are “two areas July said a key measure of returns ministration has eased its targets to ac- rise 8% after stripping out interest pay- where we see signifi cant struc- fell to 4% in the 20-year period commodate spending plans since coming ments, compared with 13.5%. While the tural changes taking place in the ended March 31, 2016 from 4.9% to power in 2014. previous year saw higher salaries for next decade,” said Jaensubhakij, in the period ended March 2015, “We expect the defi cit targets to be government employees, the current year who started in his role last month as global stock markets posted achieved, although there will be little projection is still “optimistic,” said De- as part of a leadership shakeup lacklustre performance and bond room for slippage,” said William Foster, vendra Kumar Pant, chief economist at at Singapore’s sovereign wealth yields tumbled. vice president in the sovereign risk group India Ratings. fund. “We are organising our- GIC accounted for one-third at Moody’s Investors Service. That’s be- The estimates don’t include allow- selves to be able to assess and of all investments globally by cause spending commitments are “sig- ances for housing, which are due for an respond quickly to investment sovereign wealth funds in so- nifi cant” and there are “hurdles to a rapid increase, and subsidies could rise if glo- opportunities there.” called disruptive technologies in increase in revenue collection,” he said. bal oil costs advance, according to Kotak GIC last year formed separate the three years through Novem- Before adjusting for infl ation, growth Modi: Optimistic. Institutional Equities. groups to focus on investments in ber, according to the London- is expected to quicken to 11.8% from a re- Spending on productive assets such as technology and healthcare. The based Sovereign Wealth Center. vised 10.2% the previous year, underpin- a swift recovery,” said Radhika Rao, an lier projection of Rs565bn. The divest- roads and ports is budgeted to rise 10.7%. sovereign wealth fund, one of the Global investments in new ning revenue and expenditure. However, economist at DBS Bank Ltd in Singapore. ment target is “rather rich” and “could This rests on better tax compliance and world’s earliest to invest in private technology by state investors much still remains out of Modi’s control, The government will collect just half of be manageable” only if a new plan to list revenues, analysts at HDFC Securities, equity and hedge funds, has been have risen in recent years, from such as the global direction for trade un- its “aggressive” Rs1tn target for revenue insurance companies goes through, said led by Dipen Sheth, wrote in a February an active investor in such com- $2.7bn in 2011 to $8.3bn in 2015, der US President Donald Trump. from small savings, according to Morgan Pranjul Bhandari, HSBC Holdings Plc’s 2 report. panies in recent years. Its invest- according to the latest data from To support a domestic pick-up, the Stanley. Finance Minister Arun Jaitley India economist. “While the budget may “While the intent to widen the tax net ments include Chinese Internet the Sovereign Wealth Center. government on Wednesday announced has also budgeted for a 35% increase in have outlined some good intentions, for is commendable, the results may not be giant Alibaba Group Holding Ltd, GIC and Singapore’s other state lower income tax rates for relatively low earnings from asset sales in the coming instance, more disinvestment compared easily forthcoming as soon as aspired,” Brazil’s biggest hospital chain investor, Temasek Holdings Pte, earners and small companies, and boost- year, even though the administration is to last year, much depends on execution they wrote. “We see moderate risk to di- Rede D’Or Sao Luiz SA, US mobile have been among the most ac- ed funding for a rural jobs programme. still at least Rs100bn away from meeting over the year,” she said. rect tax collections, and hence, to fi scal payment fi rm Square Inc, and In- tive, on average accounting for “Steps are taken in the right direction, the current year’s Rs455bn target. That Tax revenue growth of 12% “looks discipline or capital expenditure as the dia’s top web retailer Flipkart Ltd. about 80% of the total during though timely implementation is key for fi gure itself was slashed from an ear- achievable,” Bhandari said, as the gov- year progresses.” The groups add to other moves that period. Gulf Times 4 Saturday, February 4, 2017 BUSINESS

China billionaire-linked stocks plunge in Shanghai

AFP fears that freedoms in Hong Kong, Shanghai a semi-autonomous city with a separate legal system from the Hyundai to assemble mainland, are under threat from Stocks linked to missing Chinese Beijing. billionaire Xiao Jianhua tumbled It is against Hong Kong law for yesterday as investors ignored a mainland agents to operate in the statement saying business at his territory. vast empire was “normal” follow- Hong Kong leadership hopeful ing reports of his abduction from Carrie Lam – former government Hong Kong by security agents. cars in venture with number two and considered Shanghai-listed companies Beijing’s favourite to become the controlled by Xiao’s Tomorrow next chief executive – said she Holding dropped by their daily had “every confidence” in the limits in the first trading day in city’s law enforcement agencies China after the week-long Lunar when asked how she would en- New Year break. sure residents remain safe in the Chemical company Baotou wake of the disappearance. Nishat in Pakistan Tomorrow Technology Co, which Speaking to reporters after an already was at risk of being delist- election rally, Lam said one of her Reuters ed due to poor profits, closed 5% prime duties was to safeguard the Islamabad lower, the maximum allowed for rule of law. companies under such warnings, There has been no direct at 10.17 yuan ($1.48). response to the abduction reports yundai Motor Company plans to Sugar producer Baotou Huazi by any senior Hong Kong govern- set up a car assembly plant in Pa- Industry plunged 10%, the daily ment off icial. Hkistan in a joint venture with local limit for most companies, to end When asked about the Xiao textile fi rm Nishat Mills, an offi cial from at 12.17 yuan, while cement incident at a regular briefing, Bei- Nishat said yesterday. manufacturer Xishui Strong Year jing’s foreign ministry spokesman Hyundai’s return to Pakistan will boost Co also plummeted 10% to 17.54 Lu Kang said he was “not aware” the government’s eff orts to shake up the yuan. of the situation. Japanese-dominated car market and However, a statement late Hong Kong’s South China loosen the grip of Toyota, Honda and Su- Thursday said “production and Morning Post said Xiao, the zuki, who assemble cars in Pakistan with operations of Tomorrow Holding founder of Beijing-based Tomor- local partners. Ltd and its related companies are row Group, is in the mainland Hyundai and South Korea’s Kia Motor all normal”. “assisting investigations” into used to assemble cars in Pakistan un- Financier Xiao was last seen the China stock market turmoil til 2004 but withdrew after their local at his apartment in Hong Kong’s of 2015. partner Dewan Farooque Motors Limited harbourfront Four Seasons hotel, His wife Zhou Hongwen is now went bust. according to reports in the city running his businesses, it said It was not clear how much capital Hy- this week. yesterday. undai, South Korea’s largest automaker, He was taken by mainland Shanghai’s composite index would itself invest in the Pakistani ven- security agents last week, accord- collapsed almost 40% in just two ture. Representatives for Hyundai could ing to overseas Chinese-language months in the summer of 2015. not immediately be reached for comment. media. The plunge came after authori- Nishat Mills is a subsidiary of Nishat Hong Kong police said that ties helped inflate a bubble in the Group, a giant in the Pakistani banking, Xiao had crossed the border into market by encouraging invest- textiles, energy and cement sectors. mainland China last Friday. ment, but when it burst off icials Its share price rose 1.4% after the an- Three statements purportedly sought to pin blame on market nouncement. “Today we have signed a from Xiao – a Canadian citizen – manipulators. memorandum of understanding between denying he has been kidnapped It is unclear how Xiao is being the two companies and we will set up a... have appeared on his company’s linked to the crisis, but mainland project for the assembly and sales of both WeChat account and on the front investigators have targeted passenger and commercial vehicles,” page of a Hong Kong newspaper several investment executives on Nishat Mills company secretary Khalid An employee checks a Hyundai Motor’s sedan Grandeur at its dealership in Seoul. The company’s plan to return to Pakistan will since he went missing. suspicion of insider trading since Chauhan said. Nishat Mills fi led a state- boost the government’s eff orts to shake up the Japanese-dominated car market and loosen the grip of Toyota, Honda and Suzuki, Xiao’s case has sparked new 2015. ment with the Pakistan Stock Exchange who assemble cars in Pakistan with local partners, sources said. saying the deal was “subject to applicable statutory and regulatory approvals”. Lucky Cement, part of the vast conglom- favouring new entrants into the market 200mn people, is a potentially huge mar- Last year, French carmaker Renault erate Yunus Brothers Group. by off ering generous import duties. ket, but just 180,000 cars were sold in the agreed to invest in a new factory in Pa- The government believes increased The incentives have angered existing 2014/2015 fi scal year. kistan and South Korean carmaker Kia competition should bring down excep- market players, some of whom have said That compares with more than 2mn Motor Co said it would start assembling tionally high car prices in Pakistan, and publicly they should get similar terms. passenger vehicles a year in neighbour- cars in a joint venture with Karachi-listed in March it introduced a new auto policy Pakistan, with a population of nearly ing India. China says no to ‘currency war’ after Trump’s criticism of yuan

Reuters Japan and China, saying the two key US currency war. From a long-term per- the world’s top 20 economies, struck af- Beijing trading partners were devaluing their spective this is not benefi cial to China,” ter the 2008 fi nancial crisis, that coun- currencies. Japanese policymakers hit he said. While China was widely viewed tries would not pursue policies to target back on Wednesday at Trump’s accusa- to have held down the value of the yuan exchange rates for competitive purposes. hina said yesterday it has never tion, stressing that Japan was abiding by to gain a trade advantage fi ve to 10 years It was also an indication that the fi rst- used its currency as a tool to gain a G20 agreement to refrain from com- ago, many economists say that in the term Republican president is prepared to Can advantage in trade and was not petitive currency devaluation. past year, Beijing has been working to jettison two decades of “strong dollar” seeking a “currency war”, after US Presi- Chinese Foreign Ministry spokes- prop up the yuan’s value. policies advocated by predecessors dat- dent Donald Trump criticised Beijing for man Lu Kang, in the government’s fi rst China’s central bank has spent hun- ing back to the Clinton administration. harming American companies and con- response to Trump’s remarks follow- dreds of billions of dollars in reserves to If the US Treasury Department de- sumers with a devaluation of its yuan. ing a week-long recess for the country’s keep the yuan from falling further in the clares Beijing a currency manipulator, it Throughout his election campaign, Lunar New Year holiday, said that trade face of capital outfl ows caused by eco- starts a process under which the Trump Chinese billionaire Xiao Jianhua, founder of Beijing-based Trump threatened to levy punitive tariff s problems between China and the United nomic uncertainty. administration is required by law to de- Tomorrow Group, attending a robotics symposium at the Chinese against China in order to bring down the States should be resolved through talks. But the currency still fell nearly 7% mand special negotiations with Beijing University of Hong Kong (file). Stocks linked to missing Chinese US trade defi cit, and any formal declara- “China has never and won’t use a cur- last year, its biggest loss against the dol- to resolve the issue. billionaire Xiao tumbled yesterday as investors ignored a statement tion of China as a currency manipulator rency war to seek advantage in trade or to lar since 1994. That process could end in punitive saying business at his vast empire was “normal” following reports could provide a mechanism for launch- raise competitiveness in trade,” Lu told Trumps latest criticism signals a duties on Chinese goods aimed at elimi- of his abduction from Hong Kong by security agents. ing that eff ort. Trump on Tuesday un- reporters at a daily news briefi ng. weakening of the US commitment to that nating any advantage that currency ma- leashed a barrage of criticism against “We have no intention of fi ghting a agreement among the fi nancial leaders of nipulation would provide.

Australia hotels expand rapidly to catch China tourism boom

Reuters cording to Tourism Accommodation mates the pipeline of tourism-related Hong Kong’s Far East Consortium, Sydney Australia. projects at nearly A$20bn. Marriott, Intercontinental Hotels, Blessed with an abundance of min- Lured by cheaper airfares and a low- Starwood and homegrown Crown Re- eral resources that have helped it ex- er Aussie dollar, holidaymakers from sorts are all expanding in response to he hole in Australia’s economy tend a remarkable run of 25 years of China are increasing at double the rate this crunch point. dug by China’s dwindling ap- uninterrupted growth, Australia’s of the tourism sector, smashing fore- There are cautionary tales about ho- Tpetite for its resources is be- A$1.6tn economy is in the midst of casts and tripling the spending of next tel expansion in Australia. ing fi lled by the Chinese themselves, a challenging transition away from a source of visitors, the United States. The last two construction booms, whose growing affl uence is powering a once-in-a-generation mining boom. Average international fares have for the Sydney 2000 Olympic Games surge in travellers in a boon to tourism Now, as China’s voracious appe- fallen 7% since June 30, according and to meet Japanese tourist demand income and growth. tite for Australia’s commodity exports to Australia’s top listed travel agent, in the 1980s and early 1990s, were fol- Emboldened by the fl ood of big- ebb, the nation has deftly positioned Flight Centre. lowed by busts as too many rooms were spending Asian tourists, Australian itself as an attractive destination for Offi cial data shows Chinese arrivals left chasing too few visitors. hotel developers have embarked on Chinese tourists – most of them well- soared about 300% over the decade “In terms of supply, it’s a double- their biggest expansion ever. heeled and eager to splurge on creature to June 2016 to top 1mn, and spending edged sword,” said Olivier Coloun, in- Tourism has already overtaken coal comforts. over that period jumped more than six vestment analyst, at fund manager BT as Australia’s second-largest export The resulting spurt in construc- times to A$6.6bn. Investment Management, which is the earner, growing at an annual 13% to tion activity – expected to boost broad Over the past decade Chinese ‘high largest shareholder in Mantra, Aus- A$47bn in the third quarter of last year. economic growth by a half a percent- spenders’ – with total expenditure of tralia’s biggest resort operator. The travel surge is not new, but it is age point over the next year – provides A$4,200 or more – have been steadily “Obviously you don’t want supply to only now that visitor demand is push- a welcome relief to policy makers who increasing. grow too quickly because that can de- ing room and occupancy rates through have been hoping for a revival in other Nearly half of them arrived in Aus- press room rates and occupancy.” the roof, encouraging hoteliers to make sectors. tralia on a travel package and group All the same, most in the industry the expensive decision to add capacity. “Tourism has been a bright spot for tour, according to a 2015 study by say the China-led boom has a long way “I have no hesitation at all to build the Australian economy, and we expect Tourism Research Australia, for the to run. new rooms,” said Jerry Schwartz, who it to continue to add to GDP growth period between 2005 and 2013. “Those travellers are looking for a will open a 590-room hotel in Sydney as 2017 unfolds,” said UBS economist That has lifted average room occu- deeper, richer experience – they will under franchise for AccorHotel’s’s Scott Haslem. pancy of hotels and motels across Aus- often stay longer, they’ll use the food Sofi tel chain in September. popular tourist site Darling Harbour, for A$360mn ($272mn). It is one of Indeed, the value of approved con- tralia to a record high of nearly 67% in and beverage, they’ll try the local “Since income has got so positive I is the city’s biggest new hotel project around 120 new hotel projects in the struction work for short-term ac- the September quarter. wines,” Bob East, the chief executive of like to plough some of the money back since the Sydney 2000 Olympics. pipeline across the country, which will commodation catapulted to a record In Sydney and Melbourne – top Mantra, told Reuters. in.” Schwartz agreed in 2014 to ac- help boost room capacity by as much A$2.8bn in the September quarter. tourist destinations-occupancy rates “Their engagement is far deeper and The new Sofi tel, on the waterfront at quire it from developer Lendlease as 30% over the fi ve years to 2021, ac- Deloitte Access Economics esti- are as high as 90%. richer.” Gulf Times Saturday, February 4, 2017 5 BUSINESS

DJIA WORLD INDICES Company Name Lt Price % Chg Volume Indices Lt Price Change Dow Jones Indus. Avg 20,046.52 +161.61 Apple Inc 128.91 0.30 7,173,475 S&P 500 Index 2,294.08 +13.23 Microsoft Corp 63.21 0.06 7,429,799 Nasdaq Composite Index 5,657.59 +21.40 Exxon Mobil Corp 83.27 -0.22 3,686,497 S&P/Tsx Composite Index 15,489.87 +90.76 Johnson & Johnson 113.10 -0.41 1,631,671 Mexico Bolsa Index 47,158.88 +63.81 General Electric Co 29.56 -0.40 8,275,199 Brazil Bovespa Stock Idx 65,232.55 +654.34 Jpmorgan Chase & Co 86.68 2.47 5,692,269 Ftse 100 Index 7,195.75 +55.00 Procter & Gamble Co/The 87.80 0.05 1,701,798 Cac 40 Index 4,833.54 +39.25 Wal-Mart Stores Inc 66.74 0.06 1,764,877 Dax Index 11,633.71 +5.76 Verizon Communications Inc 48.45 0.35 3,789,088 Ibex 35 Tr 9,465.90 +59.50 Pfizer Inc 32.08 1.09 8,410,916 Nikkei 225 18,918.20 +3.62 Visa Inc-Class A Shares 86.28 4.84 13,904,739 Japan Topix 1,514.99 +4.58 Chevron Corp 113.82 1.43 2,064,045 Hang Seng Index 23,129.21 -55.31 Coca-Cola Co/The 41.69 0.70 2,496,994 All Ordinaries Indx 5,672.48 -23.91 Intel Corp 36.51 -0.48 4,524,746 Nzx All Index 1,322.67 +7.52 Merck & Co. Inc. 63.89 -0.45 3,720,964 Bse Sensex 30 Index 28,240.52 +13.91 Cisco Systems Inc 31.28 0.32 5,622,813 Nse S&P Cnx Nifty Index 8,740.95 +6.70 Home Depot Inc 137.63 0.50 581,908 Straits Times Index 3,041.94 -2.14 Intl Business Machines Corp 175.71 0.65 796,954 Karachi All Share Index 33,677.16 -89.50 Walt Disney Co/The 110.95 0.30 1,631,246 Jakarta Composite Index 5,360.77 +7.05 Unitedhealth Group Inc 161.45 0.43 863,790 3M Co 174.83 0.37 715,915 Mcdonald’s Corp 123.91 0.56 690,866 Nike Inc -Cl B 52.53 -0.52 2,741,555 TOKYO United Technologies Corp 108.94 0.54 678,078 Boeing Co/The 163.14 0.54 818,543 Company Name Lt Price % Chg Goldman Sachs Group Inc 239.54 3.96 2,507,060 Rakuten Inc 1,082.50 -0.32 4,956,900 American Express Co 78.17 2.17 1,135,635 Kyocera Corp 6,016.00 0.64 910,700 Du Pont (E.I.) De Nemours 76.15 -0.03 268,038 Nissan Motor Co Ltd 1,125.50 1.17 13,511,100 Caterpillar Inc 93.20 -0.61 1,661,033 Hitachi Ltd 660.70 0.76 22,875,000 Travelers Cos Inc/The 117.92 0.25 314,661 Takeda Pharmaceutical Co Ltd 4,913.00 1.01 2,499,000 Jfe Holdings Inc 2,043.50 -0.24 3,450,100 Ana Holdings Inc 331.10 -1.98 19,266,000 FTSE 100 Mitsubishi Electric Corp 1,637.00 -1.36 12,322,000 Sumitomo Mitsui Financial Gr 4,413.00 1.45 11,244,600 Company Name Lt Price % Chg Volume Honda Motor Co Ltd 3,423.00 0.18 4,775,900 Fast Retailing Co Ltd 35,260.00 0.34 672,700 Wpp Plc 1,846.00 0.38 1,116,428 Ms&Ad Insurance Group Holdin 3,781.00 -0.13 1,520,400 Worldpay Group Plc 282.40 0.82 13,752,134 Kubota Corp 1,805.00 -0.06 2,879,500 Wolseley Plc 4,947.00 -0.12 199,148 Visitors pass a sign inside the London Stock Exchange Group headquarters. London’s benchmark FTSE 100 index ended Seven & I Holdings Co Ltd 4,451.00 -0.49 1,820,100 Wm Morrison Supermarkets 240.50 1.26 6,716,015 yesterday with a gain of 0.7% at 7,188.30 points. Inpex Corp 1,085.00 0.14 3,710,800 Whitbread Plc 3,971.00 0.03 246,972 Resona Holdings Inc 587.90 1.73 22,860,900 Vodafone Group Plc 194.65 0.75 33,396,054 Asahi Kasei Corp 1,030.50 -1.25 2,716,000 United Utilities Group Plc 916.00 0.71 942,482 Kirin Holdings Co Ltd 1,860.50 0.51 1,491,400 Unilever Plc 3,273.00 0.79 1,645,851 Marubeni Corp 676.10 -0.73 6,577,200 Tui Ag-Di 1,184.00 1.89 539,648 Mitsubishi Ufj Financial Gro 730.00 0.29 116,582,000 Travis Perkins Plc 1,480.00 1.09 335,335 Mitsubishi Chemical Holdings 774.20 -2.56 5,681,000 Tesco Plc 197.25 0.20 13,377,249 Fanuc Corp 21,815.00 -0.05 658,700 US Dec jobs data sends Taylor Wimpey Plc 172.90 0.82 8,587,516 Daito Trust Construct Co Ltd 15,585.00 -0.54 602,400 Standard Life Plc 355.20 1.98 3,389,126 Otsuka Holdings Co Ltd 5,240.00 0.50 1,753,600 Standard Chartered Plc 803.80 1.58 3,951,586 Oriental Land Co Ltd 6,184.00 0.54 485,500 St James’s Place Plc 1,084.00 1.21 292,678 Sekisui House Ltd 1,810.50 0.25 2,570,600 Sse Plc 1,478.00 -0.27 1,216,276 Secom Co Ltd 8,186.00 1.48 669,200 Smith & Nephew Plc 1,208.00 0.67 702,578 Tokio Marine Holdings Inc 4,731.00 0.55 2,307,300 European stocks higher Sky Plc 1,005.00 0.00 2,489,539 Aeon Co Ltd 1,615.00 0.09 1,615,600 Shire Plc 4,473.50 0.47 1,269,960 Mitsui & Co Ltd 1,645.00 -0.60 4,957,700 Severn Trent Plc 2,256.00 0.09 313,869 While the job creation rate was con- night lending rate at 0.5% to 0.75%. Kao Corp 5,843.00 4.38 4,401,000 AFP Schroders Plc 2,954.00 1.16 177,341 siderably higher than the average in And it indicated it expected to im- Dai-Ichi Life Holdings Inc 2,100.50 1.47 12,327,600 London Sainsbury (J) Plc 262.00 1.63 4,173,550 Mazda Motor Corp 1,594.50 -1.91 11,060,200 recent months, “the bad news was that plement three interest rate increases Sage Group Plc/The 634.00 1.93 2,218,957 Komatsu Ltd 2,811.50 1.33 5,309,200 wage growth was virtually non-exist- this year. Sabmiller Plc 0.00 0.00 - West Japan Railway Co 7,149.00 -1.39 872,000 uropean and US stock markets ent and the unemployment rate was Higher interest rates would support Rsa Insurance Group Plc 579.00 1.14 558,275 Murata Manufacturing Co Ltd 15,420.00 4.51 1,613,000 Royal Mail Plc 409.00 -0.37 3,172,675 advanced yesterday on data higher than thought,” said Neil Wilson, a stronger dollar as overseas investors Kansai Electric Power Co Inc 1,199.00 -0.99 2,640,200 Royal Dutch Shell Plc-B Shs 2,291.50 1.48 2,464,242 showing a surge in new job crea- senior market advisor at ETX Capital. would want to buy US bonds. Denso Corp 4,954.00 -0.40 2,064,700 E Royal Dutch Shell Plc-A Shs 2,200.00 1.59 2,124,607 tion in the United States last month, “All in all, it was a mixed bag and the However, investors in stocks were Sompo Holdings Inc 4,055.00 -0.56 1,272,000 Royal Bank Of Scotland Group 229.30 3.06 9,484,402 Daiwa House Industry Co Ltd 3,008.00 0.03 1,645,800 while US bank stocks jumped on moves rather whippy dollar price action re- happy with jobs numbers which largely Rolls-Royce Holdings Plc 667.50 -0.96 2,237,282 Jx Holdings Inc 526.30 0.25 9,126,600 by President Donald Trump to roll back fl ected the uncertainty with which the confi rm the health of the US economy, Rio Tinto Plc 3,400.00 -3.27 3,426,510 Nippon Steel & Sumitomo Meta 2,727.50 -0.05 3,093,900 fi nancial regulations. markets are treating this,” he said. which has seen a slow but steady re- Rexam Plc 0.00 0.00 - Suzuki Motor Corp 4,498.00 1.79 2,218,400 Relx Plc 1,444.00 0.42 2,297,581 London’s benchmark FTSE 100 in- The dollar quickly lost gains that it covery from the 2008 fi nancial crisis. Nippon Telegraph & Telephone 4,873.00 0.31 3,150,700 Reckitt Benckiser Group Plc 7,139.00 0.42 1,387,404 dex ended the day with a gain of 0.7% had made against the euro before the US stocks were trading higher ap- Ajinomoto Co Inc 2,299.50 -0.80 1,598,800 Randgold Resources Ltd 6,890.00 1.10 393,017 at 7,188.30 points. announcement of the jobs report. proaching midday, with banking stocks Mitsui Fudosan Co Ltd 2,575.50 0.70 3,182,000 Prudential Plc 1,600.00 3.06 3,982,389 In the eurozone, Frankfurt’s DAX 30 “It’s a report that will do nothing to leading the way on an initiative by Ono Pharmaceutical Co Ltd 2,412.50 3.14 4,346,200 Provident Financial Plc 2,664.00 0.83 138,137 Daikin Industries Ltd 11,060.00 -0.94 1,055,500 grew 0.2% at 11,651.49 points and the make the Fed raise rates quicker, de- Trump to loosen banking regulations Persimmon Plc 1,975.00 0.51 539,749 Bank Of Yokohama Ltd/The 0.00 0.00 - Paris CAC 40 climbed 0.7% at 4,825.42 spite the strong-than-expected head- tightened after the fi nancial crisis. Pearson Plc 644.50 0.23 2,237,781 Toray Industries Inc 984.60 0.63 5,731,000 points. The Euro Stoxx 50 was up 0.7% line number” of jobs created, said Wil- The initiative aims to scrap parts of Paddy Power Betfair Plc 8,565.00 0.35 24,252 Astellas Pharma Inc 1,478.00 0.89 9,678,900 Old Mutual Plc 209.30 1.16 4,702,896 at 3,277.38 points at close. son. the so-called Dodd-Frank law, which Bridgestone Corp 4,033.00 -1.42 3,235,900 Next Plc 3,890.00 0.15 200,895 While the US economy added The US Federal Reserve on Wednes- backers say is aimed at curbing the ac- Sony Corp 3,537.00 4.99 18,522,300 National Grid Plc 928.20 0.77 2,750,176 227,000 net new nonfarm jobs in Janu- day kept its benchmark interest rate tions of the fi nance sector that led to Hoya Corp 4,868.00 0.52 971,400 Mondi Plc 1,774.00 0.17 880,633 ary, the biggest jump since September, unchanged and said it still expects to the “Great Recession,” but which crit- Sumitomo Mitsui Trust Holdin 4,067.00 1.09 2,615,500 Merlin Entertainment 478.30 0.10 1,406,130 Japan Tobacco Inc 3,677.00 1.72 5,886,300 analysts called the January jobs data need only gradual rate increases. ics claim creates red tape that stifl es Mediclinic International Plc 783.00 2.35 845,035 Osaka Gas Co Ltd 429.30 0.47 6,891,000 mixed overall as the unemployment The Fed last month adopted only its the industry. Marks & Spencer Group Plc 340.10 0.35 2,943,349 Sumitomo Electric Industries 1,758.50 5.93 7,376,600 rate crept up by a tenth of a percentage second interest rate hike in a decade — Shares in JPMorgan Chase were up London Stock Exchange Group 3,207.00 0.63 115,582 Daiwa Securities Group Inc 708.60 -0.46 7,078,000 Lloyds Banking Group Plc 65.99 1.70 69,576,087 point to 4.8% and wage growth stalled. putting the target range for the over- 2.4% and Bank of America 2.2%. Softbank Group Corp 8,531.00 -1.78 8,730,100 Legal & General Group Plc 238.10 2.28 8,147,124 Mizuho Financial Group Inc 207.90 0.92 199,300,400 Land Securities Group Plc 1,004.00 1.06 739,327 Nomura Holdings Inc 732.20 1.24 31,357,500 Kingfisher Plc 337.70 0.69 2,373,229 HONG KONG HONG KONG Daiichi Sankyo Co Ltd 2,562.50 0.14 2,561,400 Johnson Matthey Plc 3,181.00 -1.82 383,961 Fuji Heavy Industries Ltd 4,348.00 -0.50 5,477,100 Itv Plc 206.30 2.38 16,614,016 Ntt Docomo Inc 2,687.50 -0.11 5,185,000 Company Name Lt Price % Chg Volume Company Name Lt Price % Chg Volume Intu Properties Plc 268.90 0.71 2,175,908 Sumitomo Realty & Developmen 3,021.00 0.27 2,117,000 Intl Consolidated Airline-Di 485.60 0.46 3,651,605 Aluminum Corp Of China Ltd-H 4.01 -3.84 50,663,895 Hong Kong & China Gas 14.64 0.69 6,446,474 Sumitomo Metal Mining Co Ltd 1,585.50 2.32 4,935,000 Intertek Group Plc 3,449.00 0.35 133,700 Bank Of East Asia Ltd 32.85 -1.35 1,422,381 Hong Kong Exchanges & Clear 186.40 -0.48 2,553,934 Orix Corp 1,690.50 -1.08 8,074,300 Intercontinental Hotels Grou 3,737.00 0.84 206,669 Bank Of China Ltd-H 3.50 -0.28 171,271,069 Hsbc Holdings Plc 65.80 -0.68 23,763,448 Asahi Group Holdings Ltd 4,005.00 0.98 1,307,000 Inmarsat Plc 620.50 1.89 2,218,442 Bank Of Communications Co-H 5.68 -0.70 14,324,881 Hutchison Whampoa Ltd 0.00 0.00 - Keyence Corp 44,140.00 1.15 314,400 Informa Plc 663.50 1.69 1,026,485 Belle International Holdings 4.90 2.08 10,209,350 Ind & Comm Bk Of China-H 4.70 -0.63 209,729,067 Nidec Corp 10,725.00 0.52 688,100 Imperial Brands Plc 3,743.00 1.67 1,019,282 Boc Hong Kong Holdings Ltd 30.45 -1.30 9,498,975 Li & Fung Ltd 3.32 0.61 24,308,130 Isuzu Motors Ltd 1,483.00 -1.36 3,728,100 Hsbc Holdings Plc 685.90 1.33 8,821,714 Cathay Pacific Airways 10.48 0.38 1,946,873 Mtr Corp 39.80 0.25 1,938,521 Unicharm Corp 2,565.00 0.69 904,800 Hargreaves Lansdown Plc 1,381.00 1.69 875,335 Ck Hutchison Holdings Ltd 91.75 -0.27 2,770,172 New World Development 8.99 0.67 7,981,213 Shin-Etsu Chemical Co Ltd 9,731.00 0.06 1,247,600 Hammerson Plc 550.00 0.82 2,018,439 China Coal Energy Co-H 4.10 -2.15 14,088,580 Petrochina Co Ltd-H 6.04 -0.82 127,371,521 Smc Corp 30,630.00 0.49 413,400 Glencore Plc 311.70 -4.09 39,262,139 China Construction Bank-H 5.76 -0.17 213,384,080 Ping An Insurance Group Co-H 39.25 -0.51 21,504,063 Mitsubishi Corp 2,564.00 -2.42 7,480,300 Glaxosmithkline Plc 1,549.00 0.75 3,109,080 China Life Insurance Co-H 21.40 0.94 53,478,945 Power Assets Holdings Ltd 75.20 0.53 2,282,500 Nintendo Co Ltd 23,945.00 6.33 3,698,300 Gkn Plc 347.40 0.32 3,183,869 China Merchants Port Holding 20.75 -0.24 1,335,814 Sino Land Co 12.80 -0.47 4,041,207 Eisai Co Ltd 6,197.00 0.37 703,100 Fresnillo Plc 1,464.00 -1.35 711,158 China Mobile Ltd 86.95 -0.97 10,044,577 Sun Hung Kai Properties 108.00 0.75 3,063,378 Sumitomo Corp 1,418.00 -0.60 3,826,000 Experian Plc 1,552.00 -0.06 1,312,240 China Overseas Land & Invest 22.90 -0.43 10,446,895 Swire Pacific Ltd - Cl A 78.10 -0.57 553,411 Canon Inc 3,243.00 0.12 4,032,900 Easyjet Plc 940.50 0.59 1,240,918 China Petroleum & Chemical-H 6.17 -0.32 92,064,793 Tencent Holdings Ltd 205.00 -0.10 12,525,535 Japan Airlines Co Ltd 3,475.00 -3.31 3,627,800 Dixons Carphone Plc 307.10 -2.04 3,430,461 China Resources Beer Holdin 15.76 -0.13 3,824,934 Wharf Holdings Ltd 58.50 0.34 3,165,024 Direct Line Insurance Group 356.80 1.08 2,455,115 China Resources Land Ltd 19.42 0.62 7,053,718 China Resources Power Holdin 13.14 -0.90 7,575,609 Diageo Plc 2,213.00 0.84 1,673,367 SENSEX Dcc Plc 6,400.00 1.67 163,236 China Shenhua Energy Co-H 16.24 -1.58 16,688,902 GCC INDICES Crh Plc 2,860.00 0.88 673,972 China Unicom Hong Kong Ltd 9.21 0.00 26,974,303 Compass Group Plc 1,440.00 0.07 2,226,032 Company Name Lt Price % Chg Citic Ltd 11.32 0.18 4,420,644 Indices Lt Price Change Coca-Cola Hbc Ag-Di 1,793.00 0.17 300,193 Clp Holdings Ltd 75.95 0.20 1,545,863 Doha Securities Market Zee Entertainment Enterprise 495.85 -2.28 2,519,861 10,570.41 -25.73 Centrica Plc 226.80 0.58 6,888,708 Cnooc Ltd 9.74 0.72 51,071,510 Saudi Tadawul Yes Bank Ltd 1,397.80 0.78 1,701,672 7,098.64 -2.29 Carnival Plc 4,289.00 0.49 263,293 Cosco Shipping Ports Ltd 7.83 0.90 1,438,853 Kuwait Stocks Exchange Wipro Ltd 457.75 0.46 1,073,726 6,843.53 -4.43 Capita Plc 487.60 0.14 2,744,299 Esprit Holdings Ltd 6.00 -0.33 1,276,699 Bahrain Stock Exchage Vedanta Ltd 250.75 -3.50 10,587,787 1,307.75 +11.09 Burberry Group Plc 1,642.00 0.31 896,160 Fih Mobile Ltd 2.58 -0.39 1,675,090 Oman Stock Market Ultratech Cement Ltd 3,737.50 0.43 210,904 5,802.62 +9.29 Bunzl Plc 2,130.00 0.38 252,796 Hang Lung Properties Ltd 19.46 0.41 9,208,375 Abudhabi Stock Market Tech Mahindra Ltd 480.45 4.20 3,029,714 4,446.21 -80.05 Bt Group Plc 307.25 0.67 9,241,211 Hang Seng Bank Ltd 159.30 0.19 836,406 Dubai Financial Market Tata Steel Ltd 472.80 -0.87 5,886,467 3,623.75 -29.90 British Land Co Plc 587.50 1.21 1,930,187 Henderson Land Development 42.80 -0.23 1,871,295 Tata Power Co Ltd 80.65 0.25 3,338,125 British American Tobacco Plc 4,958.00 0.98 1,914,543 Tata Motors Ltd 522.60 -1.67 5,620,977 Bp Plc 479.00 1.33 15,770,978 Tata Consultancy Svcs Ltd 2,232.55 1.13 1,156,928 Bhp Billiton Plc 1,398.50 -2.41 7,092,063 Sun Pharmaceutical Indus 647.25 0.91 2,245,409 Berkeley Group Holdings/The 2,874.00 0.74 346,418 “Information contained herein is believed to be reliable and had been obtained from sources believed to be reliable. The State Bank Of India 277.55 1.56 19,320,977 Barratt Developments Plc 503.50 2.13 5,662,098 Reliance Industries Ltd 1,033.65 -0.94 3,140,083 accuracy and completeness cannot be guaranteed. This publication is for providing information only and is not intended Barclays Plc 229.80 3.82 26,538,711 Punjab National Bank 150.15 5.29 20,919,658 as an off er or solicitation for a purchase or sale of any of the financial instruments mentioned. Gulf Times and Doha Bank Bae Systems Plc 583.50 0.00 2,878,454 Power Grid Corp Of India Ltd 201.70 -1.10 2,617,849 or any of their employees shall not be held accountable and will not accept any losses or liabilities for actions based on Babcock Intl Group Plc 888.50 -0.22 712,561 Oil & Natural Gas Corp Ltd 200.95 0.05 5,271,221 this data.” Aviva Plc 492.10 2.44 4,293,352 Ntpc Ltd 171.95 -0.35 3,688,598 Astrazeneca Plc 4,354.00 1.91 1,831,978 Maruti Suzuki India Ltd 6,115.45 -0.47 326,871 Associated British Foods Plc 2,410.00 1.43 899,600 Mahindra & Mahindra Ltd 1,260.70 -0.34 1,504,990 Ashtead Group Plc 1,620.00 0.06 589,606 Lupin Ltd 1,492.00 0.71 514,726 CURRENCIES Arm Holdings Plc 0.00 0.00 - Larsen & Toubro Ltd 1,480.70 0.28 1,204,663 DOLLAR QATAR RIYAL SAUDI RIYAL UAE DIRHAMS BAHRAINI KUWAITI Antofagasta Plc 817.50 -2.74 2,139,583 DINAR DINAR Kotak Mahindra Bank Ltd 765.30 -0.66 1,653,099 Anglo American Plc 1,333.00 -3.23 4,490,888 Itc Ltd 273.05 -0.46 10,017,749 Admiral Group Plc 1,819.00 1.45 297,115 Infosys Ltd 936.10 0.02 4,550,304 3I Group Plc 697.50 0.72 523,690 Indusind Bank Ltd 1,303.20 1.50 1,536,332 #N/A 0.00 0.00 - Idea Cellular Ltd 109.45 -0.32 29,791,316 Icici Bank Ltd 281.55 -1.49 19,110,641 TOKYO Housing Development Finance 1,397.45 -0.27 2,312,105 Hindustan Unilever Ltd 849.75 0.53 1,083,887 Hindalco Industries Ltd 191.75 -0.80 12,330,715 Company Name Lt Price % Chg Volume Hero Motocorp Ltd 3,214.00 -0.46 370,705 East Japan Railway Co 10,050.00 -1.23 946,600 Hdfc Bank Limited 1,311.05 0.95 2,095,791 Itochu Corp 1,533.50 -0.94 9,288,900 Hcl Technologies Ltd 830.75 0.44 1,162,911 Fujifilm Holdings Corp 4,210.00 0.24 1,817,000 Grasim Industries Ltd 944.30 -0.83 688,987 Yamato Holdings Co Ltd 2,242.50 -0.75 1,621,200 Gail India Ltd 478.70 0.47 2,209,964 Chubu Electric Power Co Inc 1,485.50 -0.27 1,509,500 Dr. Reddy’s Laboratories 3,144.55 1.53 308,143 Mitsubishi Estate Co Ltd 2,160.00 1.65 6,553,000 Coal India Ltd 326.15 1.78 4,087,075 Mitsubishi Heavy Industries 472.70 -2.66 35,888,000 Cipla Ltd 607.90 4.03 2,809,392 Toshiba Corp 238.80 -0.83 53,628,000 Cairn India Ltd 276.25 -2.69 1,339,965 Shiseido Co Ltd 3,166.00 1.05 880,300 Bosch Ltd 22,419.35 -2.30 15,217 Shionogi & Co Ltd 5,634.00 3.34 1,475,100 Bharti Airtel Ltd 353.80 0.14 2,573,758 Tokyo Gas Co Ltd 499.20 2.19 10,805,000 Bharat Petroleum Corp Ltd 698.60 -0.47 1,728,304 Tokyo Electron Ltd 11,240.00 -1.75 944,600 Bharat Heavy Electricals 142.70 2.66 8,203,320 Panasonic Corp 1,166.00 -0.21 12,199,400 Bank Of Baroda 186.45 4.95 18,394,183 Fujitsu Ltd 676.40 -0.28 7,692,000 Bajaj Auto Ltd 2,808.10 0.02 272,767 Central Japan Railway Co 18,120.00 -0.77 466,700 Axis Bank Ltd 490.70 1.69 7,609,131 T&D Holdings Inc 1,727.00 1.92 5,776,300 Asian Paints Ltd 985.90 -0.31 520,203 Toyota Motor Corp 6,445.00 0.23 7,039,000 Ambuja Cements Ltd 229.25 -1.01 904,543 Kddi Corp 2,914.00 -2.13 9,621,500 Adani Ports And Special Econ 303.55 -0.20 3,620,738 Nitto Denko Corp 9,326.00 0.83 720,000 Acc Ltd 1,423.90 -0.56 693,894 Gulf Times 6 Saturday, February 4, 2017 BUSINESS/LEISURE

Adam Apple didn’t make much off those USB wires it made you purchase

By Kyle Stock C hardware decision. Time and again, chump change in the broader Apple Bloomberg the company has marched its follow- economy. New York ers down the path of progress. Its iOS “We doubt it will move the needle operating system all but killed Flash on earnings,” Morningstar analyst web sites. The introduction of its Brian Colello said after the October Pooch Cafe he timeline of the Apple uni- lightning port off ered a much sleeker announcement. “Apple’s price cut on verse can be measured as BC solution to charging a device. Most these accessories was likely an attempt Tand AC: That is, before its pop- recently, Apple stripped the head- to show consumers that technology, ular MacBook and MacBook Pro lap- phone jack from its iPhones, making not profi tability, drove the changes to tops had only USB-C ports, and after, corded ear-goggles as suddenly irrel- the ports and connectivity.” when it became your only choice. evant as compact discs a decade ago. However, to a small(ish) online The decision to ditch the tra- This time, however, things worked retailer like Monoprice, the dawn ditional USB port was announced out a little diff erently. First, Apple of the USB-C has been a windfall. October 27, and the Apple congre- seems to have out-evolved itself: Monoprice launched a new line of gation quickly split into two camps. Its newest iPhone still has a light- the adapters just before the big Ap- Some fantasised that it was a cagey ning port, so it requires an adapter ple pivot. In the fi nal quarter of 2016, profi t ploy to sell more adapters — to charge on the new MacBooks. that part of Monoprice’s business or “dongles” as the lexicon goes — Secondly, the company’s booming tripled over the year-earlier period. while others thought the switch was accessories business stood to gain It’s now shipping 20,000 cords and just classic Apple. Here, yet again, from the extra cords required, since adapters a month. was the prescient master nudg- most cost between $20 and $40. Shane Igo, that company’s sen- ing its adoring customers out of the Someone who wants to do a few ior director of product, said Mono- nest, forcing them to adopt technol- things at once–say charge an iPhone price has struggled to keep up with ogy slightly before they – and their while listening to music, could easily demand, particularly as USB-C is many devices – were ready. pay more than $100 for the privilege. adopted by other manufacturers. Garfi eld It turns out the conspiracy theo- Since the unveiling of its lat- Almost every major laptop manu- rists were very wrong (though this est MacBooks, a wave of gripes and facturer uses the port now, as do 40 viral take on the strategy remains grumbles washed over social chan- types of Android phones. hysterical). In the quarter ended De- nels under the tagline #donglelife. “It’s the only cable anyone will cember 31, revenue from dongles, For a small set of geeky folks, a pic- need for the next 10 or 20 years,” Igo headphones, and “other products” ture of a bundle of white cords be- explained. “I think it’s the fi rst piece actually fell, Apple reported on came the Instagram equivalent of of technology that has a chance of Tuesday. The Cupertino, California- avocado toast. being owned by every human.” based giant is still, for all intents and Perhaps realising the potential PR In its defence, the USB-C port purposes, a one product-company. damage, Apple quickly slashed pric- transfers fi les about twice as quickly The iPhone captured 70% of rev- es on the adapters. It also threw in a as a traditional USB, charges devices enue while adapter cords, watches, 25% store discount on those made by much faster and–perhaps most im- and TV boxes accounted for just 5%. third-party suppliers like SanDisk. portantly–receives plugs in either No Apple fanboy worth his Air- The company no doubt left some orientation (as in, there is no “up- Pods should be surprised at the UBS- money on the table, but it’s relative side-down”).

Mall Cinema (1): Jomonte Suvisheshangal (Malayalam) Suvisheshangal (Malayalam) 11:15pm. 2:15pm; Live By Night (2D) 5pm; Royal Plaza Cinema Palace Kung Fu Yoga (2D) 7:15pm; Kung (2): Enakku Vaaitha Adimaigal Bound And Gagged Fu Yoga (2D) 9:15pm; Jomonte Landmark Cinema (2): (Tamil) 2:15pm; Raees (Hindi) Suvisheshangal (Malayalam) Jomonte Suvisheshangal 4:30pm; Pet (2D) 7pm; Live 11pm. (Malayalam) 2:15pm; Live By By Night (2D) 8:30pm; Bogan Mall Cinema (2): Jackie (2D) Night (2D) 5pm; Kung Fu Yoga (Tamil) 10:45pm. 2:15pm; Kung Fu Yoga (2D) (2D) 7:15pm; Kung Fu Yoga (2D) Royal Plaza Cinema Palace 4pm; Pet (2D) 6pm; Arsenal 9:15pm; Jomonte Suvisheshangal (3): Kung Fu Yoga (2D) 2:15pm; (2D) 7:45pm; Split (2D) 9:30pm; (Malayalam) 11pm. Arsenal (2D) 4:15pm; Split (2D) Arsenal (2D) 11:30pm. Landmark Cinema (3): Jackie 6pm; Jackie (2D) 8pm; Arsenal Mall Cinema (3): Nenu Local (2D) 2pm; Nenu Local (Telugu) (2D) 9:45pm; Split (2D) 11:30pm. (Telugu) 2pm; Moana (2D) 3:45pm; Raees (Hindi) 6:15pm; Asian Town Cinema: Jomonte 4:30pm; Raees (Hindi) 6:15pm; Live By Night (2D) 8:45pm; Suvisheshangal (Malayalam) Live By Night (2D) 8:45pm; Bogan (Tamil) 11pm. 12:30, 2, 3:30, 5, 6:30, 8, 9:30, Bogan (Tamil) 11pm. Royal Plaza Cinema Palace 11, 11:15pm, 12:30 & 2am; Bogan Landmark Cinema (1): Kung (1): Jomonte Suvisheshangal (Tamil) 12:30, 3:30, 9:30pm, 12:30 Fu Yoga (2D) 2:15pm; Pet (2D) (Malayalam) 2:15pm; Live & 2am; Raees (Hindi) 6:30pm; 4:15pm; Arsenal (2D) 6pm; By Night (2D) 5pm; Kung Fu Nunu Local (Telugu) 12:45 & Split (2D) 7:45pm; Arsenal (2D) Yoga (2D) 7:15pm; Kung Fu 6pm; Enakku Vaaitha Adimaigal 9:45pm; Split (2D) 11:30pm. Yoga (2D) 9:15pm; Jomonte (Tamil) 3:30 & 8:45pm.

Sudoku Cryptic Clues Quick Clues

ACROSS DOWN ACROSS DOWN 1. Following on a triumph I 1. Have a feeling for what is 1. Motionless (5-5) 1. Peel (5) have (10) reasonable (5) 7. Concur (5) 2. Proposal (8) 7. A shot near the bull ring 2. Give a name to the new issue 8. Harasses (7) 3. Japanese robe (6) (5) (8) 10. Powerless (8) 4. Inform (4) 8. Writes down 3. In danger - ran to a kind of 11. Unaccompanied (4) 5. Flexible (7) unsurpassed achievements knight (6) 13. Clamour (6) 6. U.S. State (10) (7) 4. A hundred in established 15. Test (6) 9. Killjoy (10) 10. Smoothing things out is school of opinion (4) 17. Pleasant (4) 12. Boring (8) urgent (8) 5. In case this is the decision (7) 18. Punctuation mark (4, 4) 14. Diplomatic (7) 11. Permit is needed in 6. Depressed - expired needing 21. Insult (7) 16. Assemble (6) Virginia (4) inner vitality (10) 22. Bring on oneself (5) 19. Implied (5) 13. Deeply interested, 9. Descriptive of the idealistic 23. Dramatist (10) 20. Snug (4) we hear, in what the astronomer? (6-4) communicating spirit did 12. Push pieces in the (6) fortifications (8) 15. Substance to be of some 14. Change in place for one with Weekly’s Solutions Sudoku is a puzzle Weekly’s Solutions importance (6) a big bill (7) based on a 9x9 grid. 17. Here’s the tax - make a 16. Current line for racing cars QUICK CRYPTIC The grid is also mournful sound (4) (6) Across: 6 Kindred; 7 Union; Across: 6 Trooper; 7 Pedal; divided into nine (3x3) boxes. You are 18. Arrest the young 19. Part of the team is sadly 9 Vie; 10 Emollient; 12 9 End; 10 Contralto; 12 given a selection of attendant causing an awry (5) Forbearance; 15 Benediction; 17 Deuteronomy; 15 Commanders; values and to com- obstruction (8) 20. Some nonsense written Strangely; 19 Buy; 21 Truth; 22 17 Reinforce; 19 Sty; 21 Bouts; 22 plete the puzzle, 21. Refuse to sink (7) about one rebellion (4) Quieten. Flaming. you must fill the 22. Put on a higher plane - Down: 1 Vivid; 2 Add; 3 Seem; 4 Down: 1 Grand; 2 Boy; 3 Hero; 4 grid so that every or bring to the ground, one Indicator; 5 Connect; 8 Pliant; 11 Retainers; 5 Pastime; 8 Starve; column, every row hears (5) Foretaste; 13 Bridge; 14 Restore; 11 Germinate; 13 Tendon; 14 and every 3x3 box 23. Experts in personal 16 Duped; 18 Laud; 20 Vex. Boredom; 16 Stand; 18 Call; 20 contains the digits make-up! (10) Imp. 1 to 9 and none is repeated.

Gulf Times 8 Saturday, February 4, 2017 BUSINESS

US airlines’ CEOs ask to meet with Foreign fl ights to slip under the Tillerson on radar of EU emissions limits Gulf carriers Reuters New Year EU exempted foreign flights from scheme until 2017; UN agency approved deal to curb The CEOs of the three largest US airlines aviation emissions in October; have asked to meet with Secretary of State EU proposes extending Rex Tillerson to discuss allegations that Gulf exemption until at least 2021; states are unfairly subsidising state-owned UN deal enters into force in 2021 carriers, driving down prices and crowding out competition on key routes, accusations those Reuters carriers deny. Brussels The chief executives of American Airlines Group, United Continental Holdings and Delta Air Lines asked for the meeting in a letter nternational fl ights in and out posted on the website of the US airlines-backed of the European Union could be Partnership for Open & Fair Skies. Iexempted from emissions lim- “We are writing to bring to your attention an its for at least another four years issue of utmost importance to the future of our to give the United Nations time to industry: the massive subsidisation of three implement a global system to curb state-owned Gulf carriers and the significant pollution from planes. harm this subsidised competition is causing The EU proposed extending the to US airlines and US jobs,” the letter, sent on exemption, which was set to end at Wednesday, said. the start of 2017, yesterday to avoid “The Gulf carriers have received over $50bn in a repeat of tensions when it tried to documented subsidies from their government include all fl ights in 2012. owners since 2004,” the airlines contend to But it was immediately criticised Tillerson, who was sworn in as secretary of by environmental campaigners state that same day. who oppose an International Civil Duties of the US secretary of state, the nation’s Aviation Organisation (ICAO) deal top diplomat, include facilitating economic struck in October on a global mar- discourse between the United States and other ket-based measure for off setting countries. airline emissions. Off icials under former president Barack Obama Airlines who back the ICAO deal, convened talks on the topic but did not make which will not be mandatory until the progress US airlines expected. 2027, welcomed the EU proposal as Under changes promised by President they want to avoid a patchwork of Donald Trump, who campaigned heavily national and regional schemes. on fighting against countries taking ICAO’s deal was seen as not be- advantage of trade deals with the United ing ambitious enough by the Euro- States, the largest US carriers are hoping pean Parliament, which along with for a crackdown on foreign interference in member states, will have to approve American markets. the EU exemption proposal. Chief executive James Hogan of Etihad Aviation It will also be reviewed by the Group, which flies to six cities in the United European Commission as details States, on Wednesday said the Gulf carriers will on the implementation of the UN have to wait and see if Trump reopens the Open scheme become clear. Skies debate. The fate of the emissions trad- A passenger aircraft prepares to land at Heathrow airport in London. Airlines for Europe (A4E) which represents Ryanair, easyJet, Lufthansa, Air France “We are not flying into any further points in ing system (ETS) covering fl ights KLM and British Airways owner International Airlines Group, and others, said it expected the ICAO scheme to be the only measure for tackling carbon the US,” Hogan told reporters in Abu Dhabi on within Europe will also be assessed emissions within the bloc as of 2021. Wednesday. “We are very comfortable with our in the review, EU offi cials said, add- American network.” ing that all options were on the ta- EU’s transport commissioner, said. tional Airlines Group, and others Under the ETS emissions are accord’s aim to limit temperature “In regards to how that’s addressed moving ble, including dismantling it once The EU had ordered carriers to said it expected the ICAO scheme capped, whereas the ICAO deal increases. forward, we have to wait and see,” he said. the global system is in place to avoid buy credits for foreign fl ights un- to be the only measure for tackling allows carriers to increase them “The Commission has chosen Open Skies agreements reduce restrictions on double counting for fl ights within der its ETS in 2012 but backtracked carbon emissions within the bloc as without limit as long as they off set to again suspend the only eff ec- flying to and from partner states. the bloc. when countries said it violated their of 2021. them with carbon credits from en- tive measure to regulate aviation Not all US airlines are opposed to maintaining “The European Union is now fo- sovereignty and China threatened “This proposal provides cer- vironmental projects. emissions, all for a voluntary deal agreements with these nations. cused on getting the global scheme to cancel plane orders from Airbus tainty for European operators ena- Aviation, which produces about which is years from coming into The air cargo unit of FedEx Corp, JetBlue up and running. We are serious Group. bling them to focus their eff orts on 2% of carbon dioxide emissions, operation and which may never Airways Corp, Atlas Air Worldwide Holdings and about achieving carbon neutral Airlines for Europe (A4E) the implementation of the global was excluded from the Paris ac- actually reduce the climate impact Hawaiian Holdings banded together to create growth for aviation worldwide, and which represents Ryanair, easyJet, deal to eff ectively tackle climate cord to fi ght climate change, and of fl ying,” Bill Hemmings, aviation US Airlines for Open Skies Coalition, which we will provide technical support to Lufthansa, Air France KLM and change,” Thomas Reynaert, A4E’s environmental groups say the director at Transport & Environ- backs the Gulf-carriers’ cause. make it happen,” Violeta Bulc, the British Airways owner Interna- managing director, said. ICAO deal is not compatible with ment, said. Gulf Times Saturday, February 4, 2017 9 BUSINESS

Bears are ditching Banks make risk lucrative UK stocks with Brexit with bets for hedge funds taking Bloomberg that can take on large portfolios. Bank back seat London of Ireland completed a transaction in December in which outside investors assumed the credit risk for €185mn Bloomberg omplex debt trades that started ($200mn) of potential losses, and the New York as a way for lenders to reduce deal had the equivalent capital impact Ctheir loan exposure are becom- as shedding about 2bn euros of risk- ing a business opportunity for some of weighted assets. s stock hedging goes, the world’s biggest investment banks. Hedge funds, insurers and pension Brexit isn’t the upper- Others are worried they could become funds typically buy the bonds, which Amost on investors’ minds another source of systemic risk. put them fi rst or second in line for these days. Nomura Holdings and Credit Suisse losses. Lloyds sold notes in December With traders preparing for po- Group are among the most-active fi rms paying 12 percentage points more than litical risks in the continent, the earning high fees by providing loans to three-month Libor for the fi rst-loss cost of protecting against FTSE help hedge funds buy so-called capital- portion of a portfolio of UK business 100 Index declines has fallen to relief bonds from other banks as inves- loans. near its lowest level since April tor demand for high-yielding securities “I’m glad to have some liquidity in relative to protection prices for increases, according to people familiar what’s a very illiquid asset class,” said the Euro Stoxx 50 Index. with the matter, who aren’t author- Douglas Charleston, a money manager At the same time, the ratio of ised to talk about it and asked not to be at TwentyFour Asset Management, bearish to bullish options out- identifi ed. Those lenders are also fa- which oversees £7.6bn ($9.7bn) of as- standing on the UK gauge hasn’t cilitating trading, making it easier than sets. “It gives us some comfort that a been this low in seven months, ever for investors to buy and sell the in- handful of dealers are now prepared to while it’s climbed to its high- struments, the people said. fi nd the other side of the trade.” est since 2002 on the European Global lenders including Banco Hedge fund Chenavari likes to buy measure. Santander and Lloyds Banking Group capital-relief deals in secondary mar- “Between the elections in Ger- have used the bonds to reduce the kets, according to money manager Hu- many and France and an increased amount of capital they have to hold to bert Tissier de Mallerais. There’s value political risk, we are facing quite a cushion against losses on loans. Growth there, with distressed sellers looking to bit of uncertainty in Europe,” said of the complex securities – which use get out, he said. Daniel Murray, head of research at derivatives to transfer that risk – has The number of buyers has about tri- EFG Asset Management in Lon- raised concerns because of similarities pled in the past fi ve years, according to don. “Investors don’t like uncer- with synthetic collateralised-debt ob- Alan Shaff ran, a senior money man- tainty, hence there is some hedg- ligations which were blamed for mak- ager at Magnetar Capital in London. As ing on the downside. ing banks more interconnected and ex- many as 70 investors now buy the notes The story of British stocks looks acerbating the fi nancial crisis. or are actively exploring the market, brighter, a lot of Brexit-related “I’m pleased banks seem more will- said Robert Bradbury at StormHarbour concerns have been priced in, and ing as of late to support capital-relief Securities, which structures synthetic there is more clarity as to what we trades,” said Greg Branch, chief invest- The entrance of the headquarters of Credit Suisse is seen in Zurich. Credit Suisse and Nomura Holdings are among the deals. are to expect.” ment offi cer of SCIO Capital, which most-active firms earning high fees by providing loans to help hedge funds buy so-called capital-relief bonds from other banks. There’s also room for more new is- The turmoil that followed last buys the deals. “It seems investors suers to enter the market, which has year’s Brexit referendum is eas- can’t get enough of this risk, but they’d vest with borrowed money, amplify- tured fi nance is a tool for transforming for them,’’ said Moorad Choudhry, a been dominated in the past few years ing, with the Bank of England be wise to be careful.” ing potential gains. The lending banks and spreading risks in the fi nancial sys- former Royal Bank of Scotland Group by Europe’s largest banks, according to raising its growth projections for Nomura is one of the biggest lenders can charge as much as 4.5 percentage tem, it’s equally clear that these risks executive who worked on capital relief bankers including Jeremy Bradley, head the second time since then. to hedge funds investing in the deals points more than the London inter- don’t vanish,” said Vincenzo Bavoso, a deals. “It isn’t reducing systemic risk, of asset risk transfer in the securitised A dramatic weakening in the in Europe, according to the people fa- bank off ered rate in interest, the people lecturer at the University of Manches- it’s just transferring it from the bank products group at Lloyds in London. pound boosted the exporter- miliar with the matter. The bank, to- said. That compares with an average ter, England, who’s written papers on sector to the non-bank fi nance sector, Sweden’s Nordea Bank priced a debut heavy FTSE 100, while gauges of gether with Credit Suisse and Deutsche yield of 1% for investment-grade cor- securitisation. which in turn is being funded by the deal last year, passing on the fi rst losses small and mid-cap shares also Bank, loaned about $1.5bn to investors porate bonds in Europe, according to There will be more deals in 2017 than bank sector.’’ from an €8.4bn portfolio of corporate reached records as the nation’s through 2016 to fi nance purchases of the Bloomberg Barclays Euro Aggregate in any year since the crisis, according Last year banks sold about $6bn of loans to a pension fund, people familiar economy weathered the vote’s synthetic securitisations from other Index. to bankers at Barclays and Lloyds. The notes, protecting as much as $100bn said at the time. aftermath. banks, one of the people said. Nomura Critics say the trades move risk sales also allow investment banks to of debt on their books, according to “Many European banks are moving The FTSE 100 climbed for a and Credit Suisse also helped funds without reducing it, making the sys- generate fees from related business in- Himesh Shah, a London-based man- from a position of intellectual curios- third day yesterday. trade about $700mn of the notes with tem more interconnected and reduc- cluding lending, structuring deals and aging director at Christoff erson Robb ity on these deals, to something much On the other hand, the two one another, the person said. ing transparency. The securities are connecting buyers and sellers. & Co. more purposeful,” said Rob Scott, head biggest nations in the euro area Offi cials at all three banks declined to bespoke and illiquid, meaning banks “In a bonus-driven culture, of course The securities appeal to banks be- of securitised products for Europe, the are going through turbulent comment on their involvement. can be left exposed to another lender’s some investment banks will proactively cause they ease the burden of capital Middle East and Africa at Barclays in election campaigns. The loans allow hedge funds to in- loans. “While it’s known that struc- market these trades, it makes money rules without having to fi nd buyers London. Francois Fillon’s presiden- tial bid in France is imploding, raising concern National Front candidate Marine Le Pen may win the May ballot, while Ger- Political pressures start to show through on French bourse man Chancellor Angela Merkel’s lead ahead of the September vote Reuters November and December, when Fillon have started to gain more ground in the slipped. Paris was regularly coming out on top in the polls — unsettling investors. The Dutch will head to the polls. France’s CAC-40 equity index has also polls in March, and Italy may However, it has then climbed back up at underperformed at the start of 2017, also call for an election. Growing uncertainty over this year’s the start of 2017 to just shy of 7%. even though many of its blue-chip Here are some fi gures on the French presidential election is starting Investors also fear the possibility of a companies do much of their business UK options market: The put- to have an impact in terms of how risky win for Marine Le Pen, leader of the far- outside France, and would therefore to-call ratio on the FTSE 100 the country’s stock market is perceived right National Front (FN), with French be insulated to an extent from Parisian has dropped 20% from a high by investors. borrowing costs rising this week. politics. The CAC is down around 1% so in September as the index ral- The jitters have not only begun to play “It reflects the increasing polarisation far in 2017, compared to a 0.3% rise on lied, becoming one of the re- on nerves in the French bond market of the election, namely the growing the pan-European STOXX 600 index. gion’s best performers in 2016. but are also creeping through to French political and event risk,” said Phoebus “The likely withdrawal of Mr Fillon from Conversely, the ratio on the Euro stocks, as measured by the country’s Theologites, co-founder of multi- the presidential race not only eliminates Stoxx 50 has climbed 12% since equity risk premium (ERP). investment company SteppenWolf a pragmatic pro-business candidate but September. The ERP is the extra return investors Capital. also puts the whole traditional right in While protection is cheap for expect from a combination of dividend “Not only has a far-left candidate won disarray and thus in a dismal position both indexes, the cost of hedging yields and earnings-driven stock price the primary for the Left despite wide to face the election,” said Roberto against a 10% drop in the FTSE projections, compared with yields on expectations of a more moderate Magnatantini, head of global equities at 100 relative to bets for gains of low-risk government bonds minus candidate coming through, but the far- SYZ Asset Management. the same magnitude is about inflation. right candidate has announced that she “The most obvious beneficiaries are 12% lower than for wagers on the While a relatively elevated ERP reading will table a bill for France to leave the the candidates and parties that vocally Euro Stoxx 50. can signify that a market may off er others. France’s ERP has risen steadily in by allegations that his wife was paid for euro, if elected,” he added. contest the status quo, led by Marine The price relationship higher returns than others, it can also January, as previous forecasts of victory work she may not have done. Fillon is under pressure to withdraw Le Pen. Their economic agendas are known as skew is also near its indicate that investors are more wary for the business-friendly, conservative Fillon has denied any wrongdoing. his candidacy, while left-wing Socialist worrying enough to probably explain an lowest level since August 2015 of investing in that market compared to candidate Francois Fillon have been hit The reading dropped down in candidate Benoit Hamon and Le Pen increase in France’s risk premium.” for the UK gauge relative to the S&P 500 Index. Rouble to feel extra pressure as central bank returns to market

Reuters still create a dilemma for the central economic crisis since 2014, and view it “more comprehensive oil framework”. Moscow bank by putting downward pressure as a bastion of sober policy-making in Despite the central bank’s eff orts to on the rouble after a period of relative an otherwise hard-to-predict Russian keep the purchases at arms’ length, it calm. system. may struggle to dispel the perception ussia will resume buying dol- Already, the currency suff ered its A spokeswoman for Prime Minister of currency intervention. lars next week for the fi rst time biggest one-day drop so far this year Dmitry Medvedev said the government “This is indeed a step away from a Rsince a brief burst in 2015, but on January 26, when the operations has no “levers of pressure” on the cen- free fl oat. sources told Reuters the purchases will were announced. tral bank, while Kremlin spokesman They are doing the right thing, pre- go ahead only after a reluctant central The rouble was one of the best-per- Dmitry Peskov said Putin gave no or- senting this as an (action by) the fi - bank won assurances it could distance forming currencies globally in 2016. ders to the bank to start dollar buying. nance ministry, not the central bank,” itself from the operations. However, the government would The bank last bought dollars on a person close to the decision-making People involved in discussions of the stand to benefi t from a weaker cur- the domestic market in mid-2015 in a process in the Kremlin said. The pur- planned purchases said the bank had rency as it means oil revenues earned short-lived attempt to replenish its re- chases stem from a budget rule adopted feared investors would regard them in dollars would translate into more serves, halting them to ease downward in January. Under this, extra revenues as currency interventions designed roubles, allowing it to boost spending. pressure on the rouble. from oil exports would be directed to- to weaken the rouble, rather than the That would be especially helpful Russia’s economy was badly hurt by wards rebuilding the Reserve Fund. stated intention of replenishing Rus- in the run-up to elections next year, the combined eff ects of plunging oil That means selling roubles on the sia’s fi scal reserves depleted by low oil when President Vladimir Putin is likely prices in 2014-2015 and Western sanc- currency market to buy foreign ex- prices and international sanctions. to seek a new term. tions imposed over the Ukraine crisis. change. While from a fi scal point of The central bank, which has a policy Describing discussions before the Its Reserve Fund shrank to just $16bn view that makes sense, according of letting the rouble fl oat freely, insists announcement between the bank, fi - by early February from nearly $90bn be- to several economists, it will have a it is not intervening in the foreign ex- nance ministry and Kremlin, three ministry off ered a life line by taking re- buy the equivalent of 6.3bn roubles fore Moscow’s annexation of Crimea in knock-on eff ect on monetary policy. change market to infl uence the cur- sources said the central bank had had sponsibility. ($106mn at current market prices) 2014 as the country spent the money to According to fi nance ministry pro- rency’s rate. misgivings that buying dollars would Now she won’t have to answer un- a day on the Moscow Exchange this plug holes in the oil-dependent budget. jections, the currency transactions Instead, it said last month that it hurt its reputation on fi nancial markets. easy questions,” said the source.”She month to replenish the country’s fi scal The International Monetary Fund required to implement the budget rule would merely buy the dollars on behalf Governor Elvira Nabiullina had wor- will say it was the fi nance ministry’s reserves. has welcomed the fi nance ministry will push the rouble down. A weaker of the fi nance ministry, which came up ried she would have to justify the new decision, it’s their money, and we are The announcement covers pur- plan as it should help to rebuild re- rouble could increase infl ation and with the plan following a modest up- round of interventions, one former just acting as an operator.” chases to be made between February 7 serves, improving predictability of fi s- thus delay an economic recovery by tick in oil prices over the past year. government offi cial familiar with the The fi nance ministry announced and March 6. Many investors credit the cal policy. prompting the central bank to post- Nevertheless, the purchases may matter told Reuters. “But the fi nance yesterday that the central bank would bank with steering Russia through an However, it said the budget needed a pone interest rate cuts. Gulf Times 10 Saturday, February 4, 2017 BUSINESS

CORPORATE RESULTS MUFG Q3 net profi t rises 17% to $2.62bn on share holding sale

early to announce a meaningful recovery,” Chief Executive Matti able exchange rate shifts will drive our results as we look ahead Kahkonen said in a statement. to the rest of FY 2017”, Chief Financial Off icer Vasant Prabhu said Metso’s cautious outlook contrasts with its Nordic rivals Atlas on a conference call with analysts. Copco and Sandvik, which reported strong fourth-quarter results Visa, like MasterCard and its other peers, has been trying to cap- on the back of rising orders from miners. ture the Chinese market, which is dominated by state-run China The Swedish mining gear makers both said they expected de- UnionPay Co. Visa remains committed to China in the long-term mand from the mining industry continue to improve in the near and plans to formally submit a license application in the country, term. Alfred Kelly said in his first earnings call since taking over as chief Sharp executive from Charles Scharf on December 1. Under Scharf, who had been Visa’s CEO since 2012, the company’s Sharp said yesterday its nine-month net loss shrank by more than annual revenue jumped nearly 45%. 60% as it upgraded its full-year forecasts on structural reforms Scharf also orchestrated the company’s reunion with Visa Europe, and its takeover by Hon Hai. which closed in June last year. The acquisition helped Visa’s total The Japanese industrial mainstay, pummelled by huge losses payments volume rise 39% to $1.8tn on a constant dollar basis and mounting debts, was formally acquired in August last year in the first quarter, far exceeding the 11% growth in the year-ago by Hon Hai, better known as Foxconn, which took a 66% stake for quarter. The United States accounted for nearly 45% of Visa’s $3.7bn. total payments volume in the quarter ended December 31, while It was the first foreign acquisition of a major Japanese electronics Europe accounted for nearly 20%. firm and marked a watershed for Japan’s once-mighty home elec- Amgen tronics sector, which nurtured global brands including Sony and Panasonic but has struggled in the face of foreign competition. Amgen Inc on Thursday posted a higher-than-expected fourth- Sharp said that in the nine months to December its net loss quarter profit, helped by a jump in sales of its Enbrel rheumatoid shrank by 62.0% to ¥41.16bn from a year earlier. arthritis drug, but it issued a 2017 sales and earnings forecast It booked operating profit of ¥18.94bn ($363.86mn), reversing the range below current Wall Street estimates. previous year’s loss of ¥29.04bn. The company also announced that its Repatha cholesterol drug Sales fell 23.2% to ¥1.49tn. reduced the risk of heart attacks, strokes and cardiac death in a “Sharp is recovering but it’s still too early to declare Sharp is huge, long-awaited study of patients with heart disease, sending back,” said Hideki Yasuda, an analyst at Ace Research Institute in its shares up nearly 3% to $164 in late trade. Tokyo. “It’s obviously a positive, but there’s a lot more we want to know In the three months period to December, it booked a net profit of about the details,” Cowen and Co analyst Eric Schmidt said. ¥4.2bn “thanks to eff ects of structural reforms” implemented, it The positive heart data is seen as necessary to unlocking the said in a statement. blockbuster sales potential of the expensive medicine, as health Mitsubishi UFJ Financial Group (MUFG) yesterday posted a the bank would eventually launch a takeover bid. The bank said Operating profit will be at ¥37.3bn, moving back into the black for insurers and pharmacy benefit managers (PBMs) have been re- surprise year-on-year increase in profits for the three months to its net profit in the last three months of 2016 came in at €776mn, the first time in the past three years and up from ¥25.7bn profit jecting 75% of prescriptions written while awaiting concrete proof December, the first such rise in six quarters, helped by gains from a tad lower than analysts’ average forecast of €801mn compiled forecast announced in November. of the drug’s health benefits. its sale of corporate share holdings. by Reuters. Beazley Repatha, which dramatically lowers “bad” LDL cholesterol, had However, an ultra-low interest rate environment continued to The results were hit by contributions the bank made to rescue sales of just $58mn in the fourth quarter. drag on the lending business for MUFG — Japan’s largest lender funds set up to help weaker Italian lenders, including a €227mn Lloyd’s of London insurer Beazley reported a 3% rise in full-year For 2017, Amgen forecast adjusted earnings of $11.80 to $12.60 by assets — as well as that of other major banks in the country, all write-down — or 33% — on its investment in bailout fund Atlante. pretax profit and pointed to “significant” growth opportunities in per share, with a midpoint below Wall Street estimates of $12.46, of which have posted lower net profits for the first nine months of The bank confirmed its solid capital position with a Common the United States and other markets outside London amid a chal- according to Thomson Reuters I/B/E/S. the year ending March 2017. Equity Tier 1 at 12.9%, one of the strongest in Italy. lenging environment for insurers. The company sees full-year sales of $22.3bn to $23.1bn, while Weak economic growth has stifled demand for corporate loans “Overall results look pretty solid and show that it’s the most solid “Brexit has been a source of concern and considerable uncertain- analysts on average are looking for $23.3bn. in Japan for years, and lenders were dealt another blow in early bank in Italy at the moment,” said Jauke de Jong, analyst at AFS ty to many businesses in the City of London,” Chairman Dennis Amgen Chief Financial Off icer David Meline said the wide forecast 2016 when the Bank of Japan turned to negative rates — a move Group in Amsterdam. Holt said in a statement. range in part reflects uncertainly over how quickly Repatha gains aimed at defeating stubborn deflation but which has so far failed “The main topic is of course a possible Generali takeover, so it’s “For Beazley the concern is less acute, in part because less than more reimbursements as a result of the new data. to encourage new borrowing. unfortunate that Intesa didn’t say anything about that apart from 5% of our business is generated within mainland Europe, but The company also expects unfavourable foreign exchange rates The central bank has in fact recently cautioned that the prospects the statement this morning, that practically didn’t say anything also because we had already planned to develop our presence in to lower full-year earnings by about 20 cents per share, and said it of hitting a 2% inflation target remained uncertain, indicating at all too.” Dublin to access more business in continental Europe,” he said. will not fully benefit from Enbrel price increases due to discounts Japan’s lenders were unlikely to see their fortunes improve Phillips 66 Beazley has been working to get European insurance licences for negotiated with insurers and PBMs. anytime soon. its Irish reinsurance business to allow it to operate throughout the However, Amgen has a track record of exceeding its initial fore- MUFG’s third-quarter net profit rose 17% to ¥296.4bn ($2.62bn), US independent oil refiner Phillips 66 posted a lower-than-expect- European Union, even if Lloyd’s loses access to the bloc. casts. The world’s largest biotechnology company said fourth- versus two analysts’ average estimate for an 11% drop, mainly ed quarterly profit as margins were squeezed by the narrowing The underwriter, which provides marine, casualty and property quarter net profit rose to $1.94bn, or $2.59 per share, from $1.8bn, because gains from its sale of equity holdings more than doubled gap between prices of US crude and refined products. insurance and reinsurance, said its pretax profit rose to $293.2mn, or $2.37 per share, a year earlier. to ¥52.1bn. The company’s shares were down 1% at $80.20 in premarket for the year ended December 31, from $284.0mn a year earlier. Chipotle Its core lending activity, however, remained weak. trading yesterday. US refiners, which were facing pricing pressure Gross written premiums rose 6% to $2.19bn. MUFG’s domestic equity holdings stood at ¥6tn as of December due to a glut of refined products, are now being challenged by a The rise in profit was driven by higher investment return and Chipotle Mexican Grill’s quarterly profit fell 76.5%, hurt by mini- 2016. Japanese banks, as a traditional business practice, pick up rise in crude prices. strong underwriting performance, Beazley said. mum wage increases, higher spending on advertising, promo- small stakes in corporate clients. Phillips’ worldwide realised refining margins fell 31.2% to $6.47 in America Movil tions and a spike in costs for avocados, the main ingredient in But MUFG and its rivals have been trying to cut these holdings in the fourth quarter. guacamole. order to be less exposed to the volatility in stock markets. Smaller rival Valero Energy Corp, which reported fourth-quarter Mexico’s America Movil suff ered its largest loss in 15 years in the The company’s shares were down about 2% in extended trade on Stricter global bank capital regulations have also made it more results on Tuesday, also reported a 24.4% drop in refining fourth quarter, as higher financial costs dragged on the giant Thursday. costly to own stocks. throughput margin to $8.22. telecoms company amid shrinking margins at home. Chipotle’s sales swooned in November 2015 when the chain was However, there are no signs of a pick up in banks’ lending busi- Phillips posted an adjusted loss from its refining business of Latin America’s biggest telecoms firm, which is controlled by the linked to a multi-state E. coli outbreak, and went into free fall a ness either. MUFG reported a net interest income of ¥495.2bn for $95mn in the fourth quarter ended December 31, compared with family of billionaire Carlos Slim, said the 5.972bn peso ($289mn) month later after at least 80 Boston College students were sick- the third quarter, versus ¥519.6bn a year ago. adjusted earnings of $376mn a year earlier. net loss compared with a net profit of 15.663bn pesos in the year- ened by norovirus traced to a Chipotle restaurant. Japan’s No 2 lender by assets, Mizuho Financial Group, posted a Refining margins were also hurt by higher costs and lower vol- earlier quarter. Since then, the company has given away free and discounted 13% drop in net interest income for the period. umes due to maintenance-related activities, Phillips said. Financial costs in the period more than doubled to 29.639bn food, spent more on advertising and promotions in a bid to bring “Looking forward, for Q4, attention is on how much loan loss Phillips’ worldwide crude utilisation rate was 93%, down from 97% pesos, America Movil said. back diners. provisions banks will set aside for troubled borrowers like in the third quarter. Between October and December, Mexico’s peso was battered by The company’s net income fell $15.98mn, or 55 cents per share, Toshiba and how much losses they will book for their holdings in Consolidated earnings fell to $163mn, or 31 cents per share, in the Donald Trump’s advance to victory in the US presidential election, in the fourth quarter ended December 31, from $67.87mn, or $2.17 Treasuries as US interest rates have risen sharply,” said a banking quarter from $650mn, or $1.20 per share, a year earlier. making dollar-denominated equipment more expensive. per share, a year earlier. sector analyst with a European brokerage, who did not want to be The company reported adjusted earnings of 16 cents per share, The results also bucked expectations for a 5.337bn peso profit in a Revenue rose to $1.03bn from $997.5mn. Analysts on average named as he was not authorised to talk to media. well below analysts’ average estimate of 40 cents, according to Reuters poll of six analysts. had expected revenue of $1.04bn, according to Thomson Reuters Average interest rates on outstanding loans held by Japanese Thomson Reuters I/B/E/S. Total revenue and other income rose Its earnings in Mexico before interest, tax, depreciation and I/B/E/S. banks fell to a record low of 1.009% in November, latest Bank of 7.4% to $23.67bn, beating analysts’ estimate of $22.50bn. amortisation (EBITDA) fell 23.6%, while the EBITDA margin shrunk Sales at restaurants open for at least 13 months fell 4.8% for the Japan data shows. Hershey for the tenth consecutive quarter. quarter, in line with analysts’ average estimate, according to For the full-year through March, MUFG reiterated its net profit Total revenue at America Movil, which operates across the Ameri- research firm Consensus Metrix. forecast at ¥850bn, down 10.7% from a year ago. Hershey Co, maker of Hershey’s Kisses and Reese’s Peanut Butter cas and in Europe via its Telekom Austria unit, grew by 16.9% to Amazon Seventeen analysts on an average expect ¥923.1bn, Thomson Cups, posted a better-than-expected quarterly profit, helped by 269bn pesos, beating expectations in the Reuters poll for a figure Reuters data shows. low cocoa prices and cost cuts, and the company forecast 2017 of 265bn pesos. Amazon reported on Thursday that profit leapt during the year- AutoNation adjusted earnings ahead of estimates. Virgin Australia end holiday shopping season, but the tech giant saw shares sink The company said it expects 2017 adjusted earnings of $4.72- as revenue fell shy of high expectations. AutoNation Inc said yesterday fourth-quarter net income from $4.81 per share, beating analysts’ average estimate of $4.64, Virgin Australia Holdings said yesterday conditions in the domes- While revenue rose to $43.7bn from $35.7bn in a similar year-over- continuing operations surged 31% despite dwindling profit according to Thomson Reuters I/B/E/S. tic aviation market remained tough after it reported a 37% fall in year comparison, Wall Street had expected Amazon to take in margins on vehicle sales, thanks in part to a gain from the sale of Pennsylvania-based Hershey, known for its signature chocolate second-quarter underlying earnings before taxes. more cash during the key holiday shopping season. assets. bars, benefited as the price of cocoa fell about 22% to a near four- Australia’s domestic aviation market has been subdued for “Amazon is usually a retailer that operates at full volume, the The largest United States auto retail chain said it earned $115.6mn, year low in the quarter. the past year due to weak demand for flying from corporate noise of its sales growth a clarion call in an often muted retail sec- or $1.14 a share, from continuing operations in the quarter ended Hershey, which rejected a $23bn buyout off er from Mondelez customers, including mining companies, as well as government tor,” said GlobalData Retail analyst Anthony Riva. December 31, up 18% from $97.8mn a year earlier, or 87 cents a International Inc in June, spent less on advertising and marketing travellers. “However, this quarter that volume seems to have been turned share. in 2016, even though there was an uptick in costs in the fourth Virgin reported an underlying profit before tax of A$45.9mn down a couple of notches.” Revenues for the quarter rose 3% to $5.5bn. AutoNation shares quarter ended December 31. ($35.13mn) for the quarter ended December 30, compared with Amazon shares were down more than 4% to $805.40 in after- were down 2.9% in New York trading yesterday. The company’s North America sales, which account for about A$73mn a year earlier, as margins came under pressure. market trades that followed release of the earnings report. Results in the latest quarter reflected a gain of $20mn, or 19 cents 85% of total sales, rose 3.8% to $1.69bn in the quarter. Virgin shares fell 2% to its lowest level since July, with larger rival Net income for the quarter was $749mn, compared with $482 in a share, from the sale of operations. Hershey also forecast its 2017 net sales to increase 2-3%, helped Qantas Airways also falling 2%. the same period a year earlier, according to earnings figures. Without that gain, the company’s net from continuing operations by acquisitions and an increase in demand from the United The warning of weak market conditions from Virgin could be a While Amazon is known for its huge online retail operations, it is of 95 cents a share would have been a penny below the 96 cents States. sign that Qantas has also experienced a tougher quarter than also a major provider of cloud computing, and is a rival to Netflix a share consensus estimate of analysts, according to Thomson- Net income fell to $116.9mn, or 55 cents per share, in the quarter, expected, Merrill Lynch analyst Matthew Spence said. in streaming video. Reuters I/B/E/S. from $227.9mn, or $1.04 per share, a year earlier. Qantas in October reported domestic yields, a proxy for ticket It has been ramping up eff orts in artificial intelligence with its AutoNation’s results reflect the pressure the US auto business Stora Enso prices, had fallen by an average of 2.9% in the quarter ended Alexa-powered speakers and partnerships with makers of con- faces despite record levels of sales. September 30. nected devices. Demand for trucks and sport utility vehicles has surged, but pas- Finnish pulp, paper and packaging board maker Stora Enso said Visa Amazon founder and chief executive Jeff Bezos said the company senger cars have slumped, forcing dealers and manufacturers to yesterday its quarterly core profit fell more than expected and is looking for growth via its “Prime” subscription service, which off er steeper discounts. gave a weak forecast for the start of the year, citing low pulp Visa Inc, the world’s largest payments network operator, reported gives customers access to video, music and other services and That stress was reflected in AutoNation’s profit margins on sales prices and ramp-up costs in China. better-than-expected quarterly profit and revenue as more peo- free two-day shipping. of new and used vehicles. Shares in the company fell as much as 9% after the report which ple made payments using its network. Bezos said in a statement that Prime Video was now available in Gross profit margins on new vehicles declined to 5.2% of sales in showed that adjusted operating profit in the quarter fell 21% The company, whose shares were up 3.4% in extended trading on some 200 countries and territories. the fourth quarter from 5.6% a year earlier. to €191mn ($205mn), compared to €213mn in a Reuters poll of Thursday, also aff irmed its full-year profit and revenue forecasts. Its retail operations took in $26bn in North America and $14bn in Used vehicle profit margins fell to 6.3% from 7.3% a year ago. analysts. “The battle between strong business fundamentals and unfavour- the rest of the world. AutoNation Chief Executive Mike Jackson told Reuters yesterday For the first quarter of 2017, Stora said it expects sales and profits industry inventories were high. to be in line with that of the fourth quarter. “I look at the production plans, I see now plans to bring them “Typically Q1 is stronger than Q4 for them, and considering the down,” Jackson said. Q4 miss, this guidance is very soft,” said analyst Markku Jarvinen Discounting pressure cut an average $100 a vehicle from AutoNa- at Evli brokerage, with a “buy” rating on the stock. tion’s new vehicle profits in the quarter, he said.”That pressure In the poll, analysts had forecast 2017 core profit of €980mn, remains in 2017.” compared to reported €884mn in 2016. However, Jackson said he expects used vehicle profitability to “It is not a good start for the year,” Jarvinen said. stabilise after the first quarter, as AutoNation disposes of vehicles Stora is one of the world’s largest makers of graphic papers — aff ected by a recall relating to Takata airbags. such as newsprint and magazine paper — which have faced AutoNation’s asset sale in the fourth quarter was part of a broad- falling demand as publishing moves online. er plan to sell assets, including dealership properties, to raise Metso $500mn to fund expansion into businesses beyond new vehicle sales, including standalone used car stores, collision repair and Finnish engineering group Metso yesterday reported fourth- vehicle auctions, Jackson said. quarter profit below market expectations, a sign that demand Intesa Sanpaolo from its mining customers is not picking up despite a recovery in commodity prices. Italy’s top retail bank Intesa Sanpaolo lowered its guidance for The maker of grinding mills and crushers for miners as well as dividends to be paid on 2017 results to €3.4bn ($3.7bn) after post- valves and pumps for the oil and gas industry has been battling ing a slightly smaller than expected profit in the fourth quarter of tough market conditions resulting from miners’ spending cuts last year. and uncertainty over growth in top metals consumer China. The bank’s chief executive, Carlo Messina, said as recently as Hurt by lower volumes and project overrun costs at its miner- November he was aiming to pay dividends of 4 bn euros on this als business, Metso’s fourth-quarter profit slumped 30 % from a year’s accounts. Intesa made no mention in its results statement year ago and net sales fell 10% to €676mn ($727mn), well below of its intentions regarding a potential tie-up with insurer Generali, analyst estimates in a Reuters poll. after saying last week it was looking at a possible combination The company said it expected its overall market to improve with the Trieste-based company. slightly in 2017, but remain weak for mining equipment and satis- Earlier on Friday, it had said in a separate statement such an op- factory for mining services. tion was just a “case study”, leaving investors guessing whether “The year has started in a relatively positive way, but it is still too Gulf Times Saturday, February 4, 2017 11 BUSINESS Sensex ends higher; rupee strengthens

Agencies Exchange (NSE) yesterday by surging Mumbai 32.65% to Rs1,069.20 against the issue price of Rs806. The healthcare scaled the most (1.61%), The post-budget climb went on followed by PSU, realty, capital goods, for the third day as the Sensex IT and bank. managed to close at 28,241 points The broader markets too continued with a minuscule gain after a monthly to trend firm as retail investors survey suggested that Reserve boosted their bets, with the BSE Bank has much headroom to stay small-cap index rising 1.08% and accommodative in its policy meet mid-cap 0.61. next week. “The market is consolidating after Aided by banking and healthcare the strong rally on the budget day,” stocks, the 30-share Sensex moved said Vinod Nair, head of research at sideways for much of the session Geojit BNP Paribas Securities. “Going before settling at 28,240.52, up 13.91 forward, the focus will be on the RBI points, or 0.05%. meet next week,” he added. The previous two sessions have Meanwhile the rupee closed at a seen a rally of 570.65 points after the twelve-week high against the US dollar Union Budget was greeted positively as foreign inflows returned to India in by investors. The 50-share NSE Nifty the wake of better earnings and the settled at 8,740.95, up 6.70 points, or return of risk appetite. 0.08%. The home currency closed at 67.32 On a weekly basis, the Sensex rallied — a level last seen on November 11, 358.06 points, or 1.28%, and the Nifty 2016, up 0.1% from its previous close 99.70 points, or 1.15%. Services sector of 67.38. The local currency opened contracted for the third consecutive at 67.34 a dollar and touched a low of month in January as the Nikkei India 67.29 — a level last seen on November Services PMI stood at 48.7, as against 11, 2016. 46.8 in December 2016. FII’s bought nearly $635.60mn in The PMI survey showed that input equity over the last twelve trading cost inflation slowed since December sessions and have been buyers on whereas average selling prices shrank all but one trading sessions over this again, which may prompt the Reserve period. Bank to go in for an “accommodative” India’s 10-year bond yield closed at monetary policy. 6.409% from its Thursday’s close of Rupee was a sentiment booster too 6.401%. Bond yields and prices move The Bombay Stock Exchange (right) stands behind the Bombay High Court building in Mumbai. The BSE stock opened 35% higher than its sale price of Rs806 and as its good run against the dollar in opposite directions. extended the climb to Rs1,200 before closing at Rs1,069.2 yesterday. continued at 67.30 (intra-day). Since the beginning of this year, Shares of banks such as SBI, Axis Bank the rupee has gained 0.91%, while and HDFC Bank were at the centre of foreign institutional investors brisk buying activity, which rose by up have bought $111.40mn from local to 1.72% ahead of the RBI policy meet equity and sold $247.20mn in debt on February 8. markets. Cipla, Coal India, Dr Reddy’s, TCS, Asian currencies were trading lower. Sun Pharma, HUL, GAIL and Lupin Japanese yen was down 0.31%, advanced by up to 4.18%. Sun TV Philippines peso 0.24%, Singapore Asia’s oldest bourse Network soared 23.92% after a special dollar 0.22%, China off shore 0.17%, court yesterday acquitted former Malaysian ringgit 0.11%, South Korean telecom minister Dayanidhi Maran, won 0.07%, his brother and promoter Kalanithi Thai baht 0.05%. However, Taiwan Maran and others in the Aircel-Maxis dollar 0.34%, China renminbi 0.19%, deal case. Indonesian rupiah 0.06%. Glenmark Pharma jumped 4.21% after The dollar index, which measures the an over two-fold jump in consolidated US currency’s strength against major surges on debut as it net profit for the December quarter. currencies, was trading at 100.07, In the meantime, shares of BSE made up 0.28% from its previous close of lists on Indian rival a stellar debut at the National Stock 99.79.

Bloomberg fi rst-time sales last year, the highest brokers meeting under banyan trees nostalgic moment. Chauhan, who Mumbai since 2010, as a buoyant stock market at what is today known as Horniman worked at the National Stock Ex- lured more retail investors. Singapore Circle, a park a stones-throw away change of India Ltd for seven years Exchange Ltd, a unit of George Soros’s from the current Reserve Bank of India through 2000, said it was his first SE Ltd, which traces its roots to Quantum Fund and Caldwell India building in the central business district time inside the so-called listing room a brokers’ meeting under banyan Holdings were among investors who of southern Mumbai. at the rival exchange.“Though I have Btrees in southern Mumbai in the sold shares in the IPO, according to a It was only in 1874, after moving visited the NSE several times, I never 1850s, surged in its trading debut after draft sale document fi led with India’s venues several times, that the brokers had the privilege to sit in the listing the shares were listed on the National market regulator in September. found a permanent location just a few room,” Chauhan said before the shares Stock Exchange of India (NSE), the “It is a good diversifi cation play for hundred meters away from Horniman started changing hands. “It is a special largest bourse. investors as an exchange is company Circle. feeling.” The stock opened 35% higher than neutral and fl ourishes with general The current headquarters are housed NSE is also planning to go public, its sale price of Rs806 ($12) and ex- growth of the fi nancial sector, which on what is now known as Dalal Street, with a Rs100bn IPO. It would India’s tended the climb to Rs1,200 before is bound to happen in India,” UR Bhat, or brokers’ street. biggest fl oat in more than six years. closing at Rs1,069.2 in Mumbai. managing director at Dalton Capital BSE gets about 27% of its revenue “Listing of a market structure in- The bourse is among six compa- Advisors India Ltd, said in a telephone from trading fees and as much as 24% stitute like BSE will give investors nies who shares rose more than 30% interview. “It is a great day. from listings, according to the off er access to a new asset class, hitherto on the first trading day in the past 12 The listing of India’s first equi- document. unrepresented in their portfolio,” Sid- months, data compiled by Bloomberg ties exchange showcases the great The remainder comes from other dharth Shah, managing director JGA show. tradition and history of capitalism sources including selling data, a stock Shah Sharebrokers said by phone. The Deutsche Boerse AG-backed in India.” depository and distributing mutual “This will lead to an increase in trans- The rupee closed at 67.32 yesterday, a level last seen on November BSE tapped demand that saw compa- The BSE was formally established funds. For BSE Chief Executive Of- parency and accountability” for the 11, 2016, up 0.1% from its previous close of 67.38 nies garner Rs273bn ($4bn) through in 1875, about 25 years after the fi rst fi cer Ashishkumar Chauhan, it was a bourses, he said. Asia markets struggle

AFP as investors returned from a China rate rise hits emerging assets Hong Kong week-long Chinese New Year break unimpressed by data showing factory activity in the Reuters lar recovered some losses most bond fund manager at Standard Asian traders moved cautiously world’s number two economy had London emerging currencies slipped. Life Investments. yesterday, at the end of a volatile stabilised. The Turkish lira snapped “We’ve done very well by be- week and following another tepid Sydney eased 0.4% and Seoul a four-day winning streak, ing underweight and that’s the lead from Wall Street while focus added 0.1% while Singapore shed n unexpected Chinese falling 0.4% against the dol- fact which is making it tempt- shifts to the release of US jobs 0.2%. However, Wellington, Taipei interest rate raise yester- lar although it is on course for ing to go back in rather than figures. and Jakarta were up. Aday hit emerging stocks its best weekly gain since last anything we see coming out of Markets have struggled to find In early European trade led down by weakness across May. Turkey.” stability over the past five days London was flat, Paris added 0.3% Asia, while the Turkish lira re- Economic data remains over- The Russian rouble weakened following Donald Trump’s con- and Frankfurt gained 0.1%. sumed its downward trajectory whelmingly negative, with con- 0.2% against the dollar before a troversial ban on travellers from “It’s been very choppy waters as data showed a sharp jump in sumer infl ation jumping 2.46% central bank rate-setting meet- seven Muslim-majority countries for investors to navigate through infl ation. in January, well above forecasts ing later at which the bank is and claims that China and Japan this week,” said Gary Huxtable, The Asian losses off set mod- of 1.78% in a Reuters poll and seen holding rates at 10%. were currency manipulators. client adviser at Atlantic Pacific est gains in Europe and put the inching towards a double-digit The currency’s gains have The unpredictable start to Securities, in a note. benchmark emerging equity annual increase. stalled since authorities said the tycoon’s presidency and Attention now turns to the index on course to end the week The government said it could they would start buying hard his protectionist rhetoric have January jobs report due later fl at, despite trading up earlier in temporarily remove a tax on currency to replenish depleted sent shockwaves through world Friday, which will provide a better the week on the back of strong white goods to support domes- reserve funds. capitals and fanned worries of a picture of the US economy. factory data across the develop- tic demand, boosting shares Russia’s services sector ac- global trade war. A strong reading will put pres- ing world. in manufacturers Arcelik and tivity expanded at the fastest The selling pressure stands in sure on the Federal Reserve to Chinese mainland shares Vestel by more than 3% at one pace in 8-1/2 years in January, stark contrast to the surge seen consider an interest rate hike in slipped 0.7% on their fi rst day point, the former surging to adding to evidence that the in the two months after Trump’s March, analysts said, following a of trading after a week-long record highs. economy has turned a corner. election win, that was stoked by batch of impressive figures this break for Lunar New Year, and The overall Turkish index “In the long term (FX pur- hopes he would press on with past week. Hong Kong shares fell 0.2%, as was fl at, although lira weakness chases) is a respectable goal that promises to ramp up infrastruc- On forex markets the dollar Beijing raised short-term inter- has propelled it to the fourth will add to Russia’s strength and ture spending and cut taxes, firing recovered from morning losses est rates by 10 basis points. straight week of gains. give the government some ad- up the US economy. against the yen but investors The signs of a move towards Investors remain lukewarm ditional budget discipline. “With the news out of Washing- remain uncertain about its near- tighter policy overshadowed on Turkey, noting deterio- But at the same time it will ton and the new administration term future. It also built on gains data showing Chinese factory rating fundamentals and the help weaken the currency, ramping up even further, past against the pound after Thurs- activity expanded for the sev- central bank’s reluctance to smooth volatility, and reduce Trump reflation enthusiasm has day’s 1% surge that was fuelled enth straight month in January, raise interest rates to rein in the correlation between the waned further,” David de Garis, by a dovish outlook for British albeit at a slower rate. inflation, although there are dollar/rouble exchange rate and a senior analyst at National Aus- spending by the Bank of England. Many linked the move to Bei- signs some funds are being oil prices,” Maggio added. tralia Bank, said in a commentary. In Tokyo, the Nikkei 225 flat at jing’s eff orts to alter expecta- versed in January — the local The move pushed the Chi- tempted to buy the beaten- South African stocks fell al- Tokyo ended flat having swung 18,918.20 points; Hong Kong — tions of a one-way path for the authorities want to provide nese yuan a touch fi rmer while down assets. most 1% to three-week lows, as in and out of positive territory Hang Seng down 0.2% to 23,129.21 yuan as expectations of curren- more support for the currency 10-year bond yields hit the “We have had very little ex- the Chinese rate move hit com- owing to fluctuations in the yen, points and Shanghai — Composite cy weakening have contributed against the dollar or other cur- highest since August 2016 be- posure to Turkey for a long modity prices. while Hong Kong slipped 0.2%. down 0.6% to 3,140.17 points at to huge capital outfl ows. rencies they have trade fl ows fore easing. time, since before the coup and A 5% fall in shares of iron ore Shanghai closed down 0.6% the close yesterday. “The slide in the renminbi with,” said Cristian Maggio, a The Taiwan dollar hit a our exposure has gradually re- miner Kumba also dragged on that we saw last year has re- strategist at TD Securities. 19-month high, but as the dol- duced,” said Kieran Curtis, a the market. Saturday, February 4, 2017 GULF TIMES BUSINESS

QSE WEEKLY REVIEW Across-the-board selling leads bourse traverse through negative terrain

By Santhosh V Perumal responsible for the overall bearish over- In value, banks and financial services’ $164bn in capital expenditure in the next ices, the eight industrials, the four real transactions by 13% to 14,569 during the Business Reporter hang in the QSE during the week which share was 33%, followed by realty (24%), five years by bringing the private sector estate, the three transport and the two week. saw Dlala Holding register QR3.8mn in net industrials and telecom (12% each), onboard. telecom, five of the nine industrials and There was 61% plunge in the insurance profit in 2016. consumer goods (9%), transport (7%) and Telecom sector saw its index plummet four of the five insurers closed lower dur- sector’s trade volume to 0.32mn equities An across-the-board selling, with more Nevertheless, local retail investors insurance (3%) during the week which 4.45%, insurance (3.82%), banks and fi- ing the week. and 61% in value to QR25.8mn but on 3% than 91% of the traded stocks in the red, turned bullish and there were increased witnessed global insurance credit rating nancial services (3.81%), real estate (3.7%), Major losers included Ooredoo, Qatar jump in deals to 556. led the Qatar Stock Exchange (QSE) buying interests from their non-Qatari agency A M Best aff irm the financial industrials (3.63%), transport (1.1%) and Insurance, QNB, IQ, Commercial Bank, The consumer goods sector’s trade traverse through negative terrain and counterparts during the week which saw strength rating of ‘A- (Excellent)’ and the consumer goods (0.71%) during the week Masraf Al Rayan, QEWC, Gulf International volume plummeted 53% to 1.22mn stocks, capitalisation erode QR20bn in a week Doha Insurance announces plans to con- long-term issuer credit rating of “a-” of which saw BMI view that the GCC banks, Services, Ahli Bank, Doha Bank, Qatari In- value by 42% to QR87.97mn and transac- that otherwise saw global oil markets vert its Islamic branch ‘Doha Takaful’ into Qatar General Insurance and Reinsurance which are expected to witness slowdown vestors Group, Gulf Warehousing, Barwa, tions by 32% to 1,212. largely remain range bound. a full-scale Shariah-principled insurance Company with “stable” outlook. in credit off -take for the next five years Ezdan, Mazaya Qatar and Alijarah Holding The industrials sector reported 45% Large cap equities suff ered the most as company as part of its overall restructur- Opening the week marginally weak at and face pressure to strengthen their capi- during the week. shrinkage in trade volume to 2.48mn the QSE’s main barometer plunged 3.82% ing in line with local and regional expan- 10,885 points, the market then saw severe tal base in view of Basel III norms, could Nevertheless, Zad Holding, Doha Insur- shares, 35% in value to QR124.22mn and during the week which witnessed market sion plans. profit booking for the next two days as however earn higher interest earnings ance, Salam International Investment 9% in deals to 2,350. heavyweight Industries Qatar (IQ) report Islamic stocks were seen underper- global oil prices rather saw decline. There- from increased sovereign debt issuances. and Qatari German Company for Medical The banks and financial services sec- QR3bn net profit in 2016. forming the main index during the week after, the decline in the local bourse was Market capitalisation eroded 3.46% Devices were among the gainers during tor’s trade volume tanked 40% to 6.67mn The local bourse was the second worst which saw insurance and consumer goods rather slow but overall the 20-stock Qatar to QR568.06bn as large, mid, small and the week. equities, value by 32% to QR327.66mn and performer among the Gulf bourses. witness faster decline in trade volume and Index settled 419 points power. microcap equities melted 4.11%. 2.33%, Foreign institutions turned net sellers transactions by 15% to 5,280. Abu Dhabi had recorded 3.85% decline, value. “The market has lost its upward steam 1.4% and 1.06% respectively during the to the tune of QR126.44mn compared with The market witnessed 26% decline in Dubai (2.1%), Saudi Arabia (0.51%) and Ku- Overall trade turnover and volumes after it recorded a top near 11,100 points week which saw Baker McKenzie disclose net buyers of QR40.53mn the previous the realty sector’s trade volume to 12.14mn wait (0.13%), whereas Muscat and Bahrain were on the decline during the week and could witness further weaknesses on that Qatar emerged topper in the Middle week. stocks, 26% in value to QR243.81mn and gained 0.9% and 0.59% respectively dur- which saw realty, telecom and banking the coming period,” a Kamco technical East outbound merger and acquisition by Domestic institutions’ net buying weak- 26% in deals to 2,829. ing the week which saw Qatar Electricity sectors together account for about 82% of analysis said, adding the next support value in 2016. ened substantially to QR65.66mn against However, the transport sector’s trade and Water Company’s (QEWC) 2016 net the volumes. level comes at 10,550 points, while below Micro, large, small and midcap stocks QR103.3mn the week ended January 26. volume soared 60% to 2.03mn shares, profit at QR1.54bn. In volumes, real estate constituted it would trigger 10,350 points. have however reported year-to-date However, local retail investors turned value by 62% to QR67.17mn and transac- QSE’s year-to-date gains were seen at 37% of the total, followed by telecom The 20-stock Total Return Index tanked gains of 1.98%, 1.68%, 0.78% and 0.06% net buyers to the extent of QR50.99mn tions by 69% to 997. 1.28% compared to 19.06% in Kuwait, 7.15% (25%), banks and financial services (20%), 3.82%, All Share Index (comprising wider respectively. compared with net sellers of QR144.79mn The telecom sector registered 4% jump in Bahrain, 2.63% in Dubai and Muscat industrials (8%), transport (6%), consumer constituents) by 3.43% and Al Rayan Of the 44 stocks, as many as 39 the previous week. in trade volume to 8.08mn equities, 19% (0.34%), while Abu Dhabi and Saudi Arabia goods (4%) and insurance (1%) during the Islamic Index by 2.83% during the week declined, while only four rose during the Non-Qatari individual investors’ net in value to QR121.31mn and 5% in deals to declined 2.2% and 1.55% respectively. week which saw Vodafone Qatar, which which saw global consultant strategy& week which saw Vodafone Qatar, Ezdan, buying increased to QR9.68mn against 1,345. Foreign institutions’ net profit booking follows April-March financial year, report view that the Gulf Cooperation Council Barwa and Masraf Al Rayan dominate the QR1.23mn the week ended January 26. In the debt market, there was no and a substantially weaker buying support distributable profits of QR107mn in the (GCC) could generate more than $400bn trading ring in volumes and value. Total trade volume fell 26% to 32.94mn trading of treasury bills and government from their domestic counterparts were first nine months of 2016. through privatisation and also save All of the 13 banks and financial serv- shares, value by 27% to QR997.93mn and bonds during the week.

ECB calls for national US job growth accelerates bad banks to soak up unpaid loans in January, but wages lag Reuters Frankfurt Nonfarm payrolls increase 227,000 or the share of working-age Americans in January; unemployment rate who are employed or at least looking rises to 4.8% from 4.7%; average for a job, was at 62.9% in January, the he European Central hourly earnings edge up 0.1% highest level since September. Bank’s vice-president The employment-to-population ra- Tcalled yesterday for the Reuters tio was at 59.9% last month, the high- creation of government-backed Washington est level since March 2016. bad banks to help buy some of A broad measure of unemployment the 1tn euros in unpaid loans that that includes people who want to work have weighed on eurozone banks S job growth surged more than but have given up searching and those since the fi nancial crisis. expected in January as con- working part-time because they can- With lenders in Italy and other Ustruction fi rms and retailers not fi nd full-time employment rose weaker economies struggling to ramped up hiring, which likely gives two-tenths of a percentage point to fi nd buyers for their bad credit, the Trump administration a head start 9.4% last month. Vitor Constancio called for a Eu- as it seeks to boost the economy and Nearly all sectors of the economy ropean Union “blueprint” for cre- employment. added jobs in January. ating asset-management compa- Nonfarm payrolls increased by Manufacturing payrolls increased by nies (AMC) compliant with with 227,000 jobs last month, the largest 5,000 jobs, rising for a second straight EU rules against bailouts. gain in four months, the Labor Depart- month as the oil-related drag on the Less than a week ago, Germany ment said yesterday. sector eases. “Plenty to build on here shot down a proposal by the Eu- But the unemployment rate rose for Donald Trump who has tended to ropean Banking Authority to cre- one-tenth of a percentage point to put a premium on manufacturing jobs,” ate an EU-wide bad bank on the 4.8% and wages rose marginally, sug- said Alan Ruskin, global head of G10 FX grounds that bad loans are con- gesting that there was still some slack strategy at Deutsche Bank in New York. centrated in just a few countries, in the labour market. Construction employment jumped such as Italy, Cyprus and Portugal. Revisions to November and De- 36,000, the largest increase since “A true European AMC, how- cember showed the economy created March, likely boosted by warm weath- ever, faces diffi culties in the 39,000 fewer jobs than previously re- Job seekers speak with representatives at the Adams County Workforce and Business Center job fair in Brighton, Colorado, er, after December’s paltry 2,000 gain. present environment,” Constan- ported. US, on December 14. Nonfarm payrolls increased by 227,000 jobs last month, the largest gain in four months, the Labor Retail payrolls, surprisingly surged cio said at an event in Brussels. Still, the labour market continues to Department said yesterday. 45,900, the biggest rise since February. “In more immediate terms, a tighten, which could soon spur a faster Retailers, including Macy’s, Sears, way forward could be the crea- pace of wage growth. US stock futures extended gains on three cents or 0.1% last month. conditions would strengthen “some- American Apparel and Abercrombie tion of a European blueprint for Federal Reserve offi cials view the the report. December’s wage gain was revised what further.” & Fitch announced job cuts in January AMCs to be used at national lev- labour market as being at or near full President Donald Trump vowed down to 0.2% from the previously re- With its January employment report, amid store closures. el,” he added, calling for a “fl exi- employment. during last year’s election campaign ported 0.4% increase. the government published its annual Department store sales are being un- ble approach” to European rules. “Continued strong job creation is to deliver 4% annual gross domestic January’s marginal rise in average “benchmark” revisions and updated dercut by online retailers, led by Ama- The ECB has been ratcheting tempered by the renewed sluggish- product growth, largely on the back of hourly earnings is a surprise given that the formulas it uses to smooth the data zon.com. up the pressure on banks to of- ness in wage growth, raising questions a plan to cut taxes, reduce regulations, the minimum wage took eff ect in at for regular seasonal fl uctuations. Temporary-help jobs, a harbinger of fl oad their soured credit, which once again about the extent to which increase infrastructure spending and least 19 states last month. It also incorporated new population future hiring, increased 14,800 after it says ties up capital and curbs the functioning of the labour market renegotiate trade deals in the United The small gain lowered the year-on- estimates. shedding 12,800 positions in December. fresh lending. But the market for has evolved,” said Mohamed El-Erian, States’ favour. year increase in earnings to 2.5% from The government said the level of Employment in the fi nancial sector European bank loans has not tak- chief economic adviser at Allianz in Although details on the policy pro- 2.8% in December. employment in March of last year was increased by 32,000 jobs last month, en off , with transactions totalling Newport Beach, California. posals remain sketchy, consumer and Sluggish wage growth, if it persists, 60,000 lower than it had reported. an acceleration from December’s €200bn ($215bn) in the last three Economists polled by Reuters had business confi dence have surged in the would suggest only a gradual pace of As the labour market nears full 23,000 gain. years even after including expo- forecast payrolls rising 175,000 last wake of Trump’s election victory last rate increases by the Fed. employment, the pool of workers is Healthcare and social assistance sures that are being repaid. month and the unemployment rate un- November. The US central bank, which hiked shrinking, which is slowing job growth. payrolls increased 32,100. Constancio said there was changed at 4.7%. But with the economy near full em- rates in December, has forecast three The shift in population controls Government employment fell for a scope for national governments Prices for US government bonds rose ployment, some economists are scep- rate increases this year. mean fi gures on the labour force or fourth straight month in January. to step in and fi re up that market as traders focused on the disappointing tical of the 4% growth pledge. On Wednesday, the Fed kept its number of employed or unemployed Further declines are likely after the by injecting capital into banks, wage growth. Annual GDP growth has not exceed- benchmark overnight interest rate un- in January are not directly comparable Trump administration enforced a hir- guaranteeing securities backed The dollar was little changed against ed 2.6% since the 2007-08 recession. changed in a range of 0.50% to 0.75%. with December. ing freeze on civilian federal govern- by NPLs — as Italy is doing — or a basket of currencies. Average hourly earnings increased It said it expected labour market The labour force participation rate, ment workers on January 22. even buying some of them. ECB puzzles over question of whether recovery is for real

Bloomberg ing policy normalisation, are waiting future on the line. The ECB president another issue is the persistent diver- tinues to increase. And if factories are Nagle predicts the ECB will strike Madrid for confi dence to build among their said in a speech in Ljubljana on Thurs- gences between the region’s northern busier again and more and more peo- a more hawkish tone as the year peers to tip the balance in favour of an day that Europe shouldn’t turn its back and southern economies. ple fi nd jobs, wages and prices will rise progresses, adjusting its forward exit. on free trade and open borders in the While Draghi has argued that a “very faster as well.” guidance following the French elec- hen is a recovery not a recov- “Draghi is erring on the cautious face of rising nationalism and global substantial degree of monetary accom- Weidmann, a frequent critic of QE, tion in May, and announcing in Oc- ery? side; what he doesn’t want to do is act insecurity. modation” is still needed, a slew of has argued that higher inflation will tober — after Germany picks a new W While an economic up- too soon and be forced to backtrack,” Another concern is continued weak- data this week provide ammunition for depress real interest rates, providing a chancellor — that tapering will start turn is clearly under way in the 19-na- said Holger Sandte, chief European ness in underlying price pressures, those in favour of timely exit talks. de facto easing that allows the ECB to in early 2018. tion euro region, a fundamental ques- analyst at Nordea Markets in Copenha- with core infl ation failing to top 1% for The economy grew at the fastest gradually phase out asset purchases Meanwhile, the ECB this week gave tion for the European Central Bank is gen. “Core infl ation will be key. As long more than a year. A pickup in headline pace in three quarters in the last three while keeping policy supportive of its own cautious assessment in the de- whether it is a bona fi de cyclical revival as it remains subdued, the doves have a infl ation to a level eff ectively in sync months of 2016 as unemployment fell the recovery. Executive Board mem- bate over the nature of the economic or if it is purely supported by monetary case. That is not to say the hawks will with the ECB’s goal of just below 2% to the lowest level since 2009. Confi - ber Sabine Lautenschlaeger, a fellow revival. stimulus. Which view policy makers go quiet. They’re going to get bolder hasn’t convinced Draghi, who wants dence hit a six-year high in January and German, has openly called for a talks “Although the recovery has been back will help determine how quickly and louder as they see confi rmation in more certainty it will prove durable and manufacturing accelerated. on unwinding stimulus to start soon. gradual and moderate, there is evidence they unwind asset purchases and start the data.” broad-based. Bundesbank president Jens Wei- “Growth prospects for the euro area that it is becoming more broadly based to raise interest rates. Draghi’s caution is being fed by risks “The core of our analysis will be ‘is dmann is probably one of the most are encouraging, and while core infl a- and fi rmer, both in terms of country Since ECB president Mario Draghi’s including protectionist rhetoric from this higher infl ation sustainable?’” ECB faithful adherents of the view that cy- tion remains weak, risks are no longer developments and across sectors,” the push to extend quantitative easing gar- the new US administration, Brexit and Executive Board member Benoit Co- clical upturn has taken hold. to the downside,” said Peter Nagle, an central bank said in its Economic Bul- nered broad consensus just two months an election-heavy year in Europe. Eu- eure said in a speech in Paris on Thurs- “Despite the perception given by economist at the Institute of Interna- letin on Thursday. ago, a rebound in infl ation and an im- ro-sceptic parties are gaining support day. “The conclusion today is: no.” some discussions, economic prospects tional Finance in Washington. “The “This bodes well” and is in “sharp proving outlook have amplifi ed calls ahead of national votes in some of the Faster infl ation also has implications for the euro area are not that bad,” he ECB can justify its downside scenario contrast to the short-lived recovery in for a shift in policy. German offi cials in region’s largest economies, threatening for the consumer-led recovery if wages said on January 26. “The output gap is until June. By then it will have to recog- 2009-10, when growth was relatively particular, already supportive of start- to once again put the single currency’s don’t rise to off set higher prices, and slowly closing and employment con- nise that the outlook has changed.” uneven.”